Baltimore Bridge Collapse to Cost Insurance Companies $4 Billion

Analysts expected that the collapse of the Francis Scott Key Bridge in Baltimore would cost insurance companies billions of dollars, and losses could reach $4 billion, which would make the tragedy a record loss in shipping insurance.

Baltimore Bridge Collapse. Full video.

**Ship lost power twice.** pic.twitter.com/I5JYYpL5Z7

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On Tuesday evening, the authorities in Baltimore announced the suspension of the search for six people who went missing after the bridge collapsed in the as a result of a container tanker colliding with it, noting that the six missing people are now considered dead. Coast Guard official Vice Admiral Shannon Gilreath said during a press conference, “Based on how long the search operations took... and the temperature of the water, we now do not believe that we will find these individuals alive.”

Since the collapse of the important Francis Scott Key traffic bridge in Baltimore on the east coast, the authorities have used drones, helicopters and divers, which allowed the discovery of two survivors, one of whom was seriously injured.

Insurers and analysts are now evaluating potential losses across several product lines including real estate, merchandise, marine services, liability, commercial credit and emergency business interruption, according to Reuters.

“Depending on the length of the shutdown and the nature of the Port of Baltimore’s business interruption coverage, the value of insured losses could range from $2 billion to $4 billion,” said Marcos Alvarez, managing director of global insurance ratings at Morningstar DBRS.

Alvarez said the disaster would likely put upward pressure on marine insurance rates globally.

Mathilde Jacobsen, senior director of analytics at insurance rating agency AM Best, said claims were likely to reach "billions of dollars".

Ship insurance covers marine environmental damages and injuries through protection and compensation insurance companies known as protection and compensation clubs.

The international group "P&I" (Protection and Indemnity Clubs) insures about 90% of the world's ocean cargo, and the member protection and indemnity clubs mutually reinsure each other by sharing insurance premiums that exceed $10 million.