Lloyd’s Insurance acknowledges losses in Baltimore Bridge Crash

The Baltimore Bridge collapse has caused two of the largest players on the Lloyd’s of London Insurance market to announce that they will be affected.

Hiscox informed investors that the company expected to incur a “moderate loss” from the catastrophe. Lancashire, another insurer, admitted that it was “somewhat exposed” to the disaster, but said the impact would be “within expectations for such an event”.

Insurance companies are scrambling to calculate the costs of the collapsed of the Francis Scott Key Bridge which has disrupted supply chains and blocked one of the largest ports in the United States.

Bruce Carnegie-Brown has predicted that this disaster will lead to the largest marine loss ever in the history. Some analysts believe that the final cost could be as high as $3 billion. This would be a far greater loss than the $1.5 billion incurred by the insurance industry in the aftermath of the Costa Concordia wreck off Italy twelve years ago.

On March 26, the cargo ship Dali collided with the Baltimore Bridge. Six workers were killed while repairing potholes in the bridge. The fifth victim’s body was found on Wednesday.

Hiscox is a FTSE 250 company that said, in a trading update, that the claim was complex, given the challenges of wreck removal, clean-up and rebuilding of bridge as well as potential claims for business interruption. It also stated that Lloyd’s had taken part in reinsurance with the International Group of P&I Clubs that insured the Dali.

Lancashire said in a separate statement that it was still assessing how the disaster would impact the company.

Chubb, a New York-listed company that insured the bridge, is reportedly preparing a $350m payout to the State of Maryland. The Wall Street Journal reported that this would be the first major insurance payout in connection with the collapse of the bridge.

Hiscox Lancashire is a member of Lloyd’s. This world-renowned insurance market brings together brokers and underwriters to provide cover for anything from hurricanes and terrorism, to fine art, satellites, and more. The market dates back to the 17th century, when it became a major provider of shipping insurance.

Hiscox, based in Bermuda, is the company behind one of Lloyd’s oldest businesses. It also has retail and a reinsurance arm. Aki Hussain said that the company had a “good start” to 2024. The shares of the company fell 42p or 3.5 percent to £11.75, after trading ex-dividend, before a payout of 25 cents per share next month.

Lancashire’s quarterly gross premiums also increased 7.8% year-on-year, reaching a record $631.17 million. Alex Maloney said the company’s “very strong start” for the year.

Analysts at Jefferies & JP Morgan noted Lancashire’s premiums as being slightly below expectations. Its shares dropped by 4p or 0.7 percent to 598p.

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