Chubb Braces For Record Shipping Insurance Loss After $350M Payout For Baltimore Bridge Collapse

In the wake of Baltimore’s Francis Scott Key Bridge collapse, insurance company Chubb CB is set to shell out $350 million, potentially setting the stage for an unprecedented shipping insurance loss.

What Happened: Chubb, the insurer for the collapsed Baltimore bridge, is readying to make a significant payout to the state of Maryland, Reuters reported on Thursday

The payout, which is likely to be approved within weeks, was disclosed in a statement by Henry Daar, head of property claims at WTW, the broker for the bridge.

This $350-million payout could be the first of many related to the catastrophe. Analysts have projected that the total cost to insurers could escalate to $4 billion, establishing a new record for shipping insurance loss.

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The bridge collapse that resulted in the deaths of six people happened when a Singapore-flagged container ship hit the iconic bridge. Chubb, Maryland, and the victims’ families are expected to sue the ship owner and others to recoup losses from the crash, according to a WSJ report.

Why It Matters: The bridge collapse has had far-reaching implications. The disaster has significantly disrupted supply chains, with shipping lanes affected as carriers are forced to seek alternative ports while the collapsed bridge continues to block the river.

Furthermore, the investigation into the incident is looking at the possibility of contaminated fuel contributing to the cargo ship losing power and crashing into the bridge. The operations and safety record of the vessel, known as the Dali, as well as those of its owner and operator, have come under scrutiny.

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