A Samsung Electronics Co. semiconductor plant in Texas sued its insurer for $400 million in damage claims stemming from a power outage caused by a deadly winter storm in 2021.
According to the federal lawsuit filed against Factory Mutual Insurance Co. on Monday, the Austin plant suffered “catastrophic losses” due to property damage and lost business. According to Samsung, the insurer refused to cover the full cost as part of a “broader scheme” to underpay all storm-related claims by Texas policyholders.
According to the lawsuit, Factory Mutual paid $126 million of the $400 million claim to Samsung, citing policy exclusions for events that occur off the insured property.
“FM Global has wrongfully and maliciously refused to honor its agreement to insure its full share of Samsung Austin’s covered losses,” the manufacturer claimed in the lawsuit.
Factory Mutual Insurance did not immediately respond to a request for comment.
During the blackouts, the Samsung plant was without power for approximately three days and had to spend the following days gradually restoring power to its fabrication units, resulting in business interruption and additional expenses, according to the company. During the freezing weather, the facility also sustained physical damage to its exterior.
The case is Samsung Austin Semiconductor LLC v. Factory Mutual Insurance Company, case number 1:23-cv-00114, in the United States District Court for the Western District of Texas (Austin).