The cargo ship crash into Baltimore’s Francis Scott Key Bridge is expected to result in billions of dollars in liability claims, with marine insurance companies being responsible for a significant portion of the costs. Given the complexity of untangling ownership and addressing damages, litigation is anticipated to extend for years, with the potential for the total claim to exceed a billion dollars.
The Dali ship, owned by Grace Ocean Private and insured by Britannia Protection and Indemnity Club, is covered by numerous reinsurers providing around $3 billion in coverage to the insurers. Despite the substantial losses, the claims will be spread across many insurance companies and are unlikely to cause bankruptcy or a significant increase in insurance prices within the industry.
The full extent of damages and rebuilding costs from the collision are yet to be determined, with various factors such as the value of the bridge, liability suits, medical expenses, clean-up costs, and car damages adding to the financial impact. Comparisons have been drawn to similar high-value insurance claims, such as the Costa Concordia incident, with estimates suggesting that insurers could face claims of up to $3 billion for the Baltimore crash.
While Dali was chartered by Maersk at the time of the collision, the ultimate liability falls on the ship owner, Grace Ocean Private. The ship owner may benefit from an old statute dating back to 1851 that could limit their liability based on the post-accident value of the Dali. President Biden has pledged federal support for rebuilding the Francis Scott Key Bridge, though funding sources are yet to be clarified and could require additional support from Congress.
Despite the economic losses resulting from the interruption of businesses in the area due to the bridge collapse, purely economic losses are not recoverable from the ship’s owners in a maritime tort claim. However, claims from individuals who lost family members or were injured in the collapse are more likely to succeed, while efforts are being made by Maryland lawmakers to provide income replacement for Port of Baltimore workers impacted by the incident. The human and economic costs of the tragedy are emphasized, highlighting the need for support and resources in the aftermath of the disaster.
