The Gulf Oil Spill: Will Insurance Cover Your Business’s Lost Income in Pennsylvania?

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The Gulf Oil spill has created massive losses. Estimates of losses and the rate of the oil leak seem to grow by the day. Some experts predict that oil will enter the Gulf Stream and make landfall along the East Coast, creating an even greater financial impact.

Insurance covers many of the losses associated with the oil leak. For example, Transocean, the owner of the oil rig that burned and sank, has already collected approximately $500 million in insurance recoveries for its physical loss. Transocean’s insurers are also covering losses associated with oil that leaked from the rig (very little), but denying responsibility for oil leaking from the well itself. On the other hand, BP is largely self insured for the cost of the cleanup and has already spent over $2 billion. It has pledged to create a compensation fund of another $20 billion. It is impossible to estimate BP’s total liability associated with the spill.

Although the fate of BP and its partners is fascinating, many businesses are more concerned about whether they will be able to recover for their loss of income caused by the oil spill. Fishermen and beachfront hotels are already experiencing the impact of the oil. The spill, however, will affect businesses farther inland too. For example, restaurants may experience shortages of seafood from the Gulf and goods transported through ports along the Louisiana coast may be delayed.

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Published In: Civil Remedies Updates, Insurance Updates, Personal Injury Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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