Estimated Insurance Losses in US Soar to $3 Billion
The collapse of a bridge in the US city of Baltimore is set to result in the largest single marine insurance loss ever recorded, according to a British insurance marketplace.
Six people are presumed dead following a ship collision with the bridge, with divers having recovered two bodies so far. Experts estimate that the damages from the incident could amount to as much as $3 billion (£2.3 billion).
John Neal, CEO of Lloyd’s of London, stated, “I would say it’s certainly going to be one of the largest marine losses in history. Of that there is little or no doubt.” He emphasized that the silver lining is that the damages are insured, including both the port and the ship involved in the collision.
The Maryland Department of Transportation has requested $60 million in emergency funds from the Biden administration to assist with debris removal and cleanup efforts. Additionally, the closure of the shipping lane until the bridge is repaired could lead to losses of up to $15 million (£11.8 million) due to the Baltimore port’s significant role in global commerce.
While Mr. Neal did not provide a specific figure for the insurance claims, analysts at Barclays projected that insurance companies could face costs of up to $3 billion. This includes damages to the bridge itself, estimated at $1.2 billion, as well as potential fees ranging from $350 million to $700 million for wrongful deaths.
The closure of one of the US’ largest ports during the bridge repairs could incur further expenses, impacting global supply chains. President Joe Biden has expressed support for federal government coverage of the bridge reconstruction costs.
Paul Wiedefeld, Maryland Department of Transportation secretary, assured the public that addressing the bridge collapse will be a lengthy process. However, officials are committed to swiftly designing a replacement bridge to restore port operations and community functionality.
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