Baltimore’s Francis Scott Key Bridge Collapse Makes Headlines in Insurance Industry

The collapse of Baltimore’s Francis Scott Key Bridge has sent shockwaves through the insurance industry, with multiple stakeholders facing significant losses and potential claims. The tragic cargo ship crash that led to the bridge collapse has left six workers dead and numerous businesses and individuals impacted.

The Maryland Transportation Authority (MDTA) has filed claims on its $350 million property insurance policy and $150 million liability policy following the collapse. The Dali cargo ship, insured by Britannia P&I, is part of the International Group of P&I Clubs with over $3 billion in reinsurance cover. Grace Ocean Pvt. Ltd and Synergy Marine Group, the ship’s owner and manager, have also filed a petition to limit their liability based on the Limitation of Liability Act of 1851.

The insurance implications of the Key Bridge collapse extend beyond property insurance to include marine liability, life and accidental death & dismemberment (AD&D) insurance, cargo insurance, directors & officers (D&O) insurance, trade credit insurance, business interruption insurance, and contingent business interruption insurance. The impact of the collapse on the wider insurance industry is expected to be significant, with experts predicting it could become the largest marine loss in history.

Despite the magnitude of the disaster, the insurance industry is prepared to absorb the losses, thanks to a well-funded network of carriers and reinsurers. The global reinsurance market is expected to spread the estimated $4 billion loss, ensuring that the industry remains solvent and able to fulfill its obligations. The Key Bridge collapse serves as a stark reminder of the vital role insurance plays in supporting infrastructure and facilitating recovery in times of tragedy.