Baltimore bridge collapse: Who will pay for the destroyed bridge, harmed businesses and lost lives?

The collapse of the Francis Scott Key Bridge in Maryland is a multilayered tragedy: For the families and friends of those killed or presumed dead, it is a deep and personal loss. For businesses that depend on the Port of Baltimore, it's an economic nightmare.

And for the federal courts, it will soon become a balancing of dollars and facts, with networks of insurance companies expected to foot at least some of the bill.

The accident occurred early Tuesday when a cargo ship lost power and collided with the Francis Scott Key Bridge in Baltimore. Eight people were on the highway bridge when it collapsed. Two were saved. The bodies of two more were recovered, and four are missing and presumed dead.

According to the economic analysis company Implan, the wreck closed the Port of Baltimore, a major shipping port, potentially causing the region's economy to lose hundreds of millions of dollars in labor income over the next month alone.

A report from credit rating agency Morningstar DBRS predicted the collapse could become the costliest marine insured loss in history, surpassing the nearly $1.5 billion record set by the sinking of the Costa Concordia cruise ship near Italy in 2012. . Morningstar DBRS estimates that total insured losses for the Baltimore disaster could be $2 billion to $4 billion.

Here's a look at the costs, legal claims, and insurance companies who paid out:

In federal court, the lives lost and damaged property will be separated into a matter of dollars and facts: Were the people or businesses that owned and operated the ship negligent in some way? Was someone else partly responsible? How much will it cost to replace the bridge and make the victims' families financially prosperous?

Insurance companies will ultimately be on the hook for at least a portion, if not all, of the total cost.

Enrique Serna, a lawyer who specializes in representing immigrant workers and others hurt on the job, said his company was contacted by the families of some victims shortly after the collapse, though he is not yet representing them. Were. Workers filling potholes on the bridge came from El Salvador, Honduras, Guatemala and Mexico decades ago.

Serna said lawsuits are inevitable, and the ship's insurers will soon seek a “cap of liability,” asking the judge to set a limit on damages they can be ordered to pay. Victims will need to respond quickly to ensure that no limits are set too low.

“What happens is, it's a race against time as to when you can file a claim for it,” Serna said.

Attorney Thomas Schoenbaum, a maritime law expert and University of Washington professor, said that despite significant economic damage, affected businesses will not be able to sue ship owners and operators.

“There is generally bad news about this: in maritime law, pure economic losses cannot be compensated. If you suffer an economic loss, lose money, or a business closes, or a business loses customers, unless you suffer some physical damage along with the economic loss, maritime law states that no recovery No,” he said.

An exception is for damage caused by pollution such as oil spills, he said, and bridge debris does not count as pollution under maritime law.

Charm City Warehouse owner Bernard Sommer, whose Baltimore-based business serves shipping companies needing to store cargo containers, expects to see huge losses as long as ships are being diverted to other ports. Will have to endure.

“If they open it in 30 days, we will lose 60 to 90 days of business. And it's too early for them to do it in 30 days,'' he said. “Until this channel is open and shipping, they will show no service into the port of Baltimore.”

Sommer said he has not yet contacted his insurance company to ask if his policy covers losses related to the Port of Baltimore closure.

“What if the building caught fire and we couldn't work, or something like that? Yes, that's covered. But I don't know if that's something covered or not,'' he said. “It's hard to tell. When you sign up for insurance, they give you a page of everything that's covered. And then there's 45 pages of everything they're not going to cover.”

On Friday, Atlantic Maritime Ship Supply had to send a truck to Newport News, Virginia, to service a ship originally bound for Baltimore. Owner Edward Dryer also hasn't checked his insurance yet – he's waiting to see if there will be a significant impact on his operations.

He hopes the port will gradually reopen in a matter of weeks, not months.

“Be optimistic that they're able to at least partially open the channel reasonably quickly,” Dryer said.

Experts say replacing the bridge could cost $400 million or more.

Cruisers and other marine vessels often have more than one type of insurance. They often have policies that cover damage caused to the hull or machinery, and may also have coverage for cargo carried by the ship.

But for other very expensive losses – such as major environmental damage or disasters like bridge collapses – large shipowners turn to something called “protection and indemnity,” or P.,i insurance.

P,I Insurance may be provided by “clubs” made up of several policyholder-owned insurance companies. Club members put money into a pool of money that can be used to cover catastrophic claims. The idea is to share the risk associated with major disasters so that no company is left to bear it alone.

Insurance Clubs can also purchase their own insurance to cover expenses that are too large for the pool to handle alone. This is called “reinsurance” – the club is the first insurance that pays, and then the second payer is the “reinsurance”.

Britannia P,The I Club insures ships involved in accidents. London-based Club P is also part of the larger international group,I Club, which will help cover expenses if they exceed a pre-arranged amount. Reinsurance companies may also pick up part of the tab.

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