Insurance Premiums for Offshore Drilling Soar 15%-50%

[Ed Barrow]

Source: Wall Street Journal

The price to insure offshore drilling in the Gulf of Mexico has risen at least 15% since last month's Deepwater Horizon disaster and may stay permanently higher, as unknowns about the spill cleanup have left insurers feeling in the dark about their risks, industry executives say.

Before the rig sank in 5,000 feet of water and touched off a massive oil spill, the cost of insuring a physical rig itself ranged from $3 million to $9 million a year, said Richard Kerr, chief executive of MarketScout, a Dallas-based electronic insurance exchange. The premium would depend on the deductible and other factors.

Liability coverage, including for a large oil spill, would be priced separately, Mr. Kerr said.

Rates have risen 15% to 25% for rigs operating in shallow water, said Mr. Kerr, whose monthly summary of insurance prices are followed by insurers and their commercial customers. Price increases for operations further out to sea might be as high as 50%, he said.


Read more: http://online.wsj.com/article/SB10001424052748704167704575258772553997694.html?mod=WSJ_hpp_MIDDLETopStories

[Sanity Claws]

1. Shit the rates should have quadrupled

[PSPS]

2. Meanwhile, insurance rates for nuke plants have...

... oh, that's right. You can't buy insurance for a nuke plant at any price. It is the taxpayer who is, in fact, the "nuke insurance company" -- privatize the profit, socialize the loss.

I wonder if this will be the next step for big oil -- let the taxpayers become their "insurance company."

[Fearless]

3. Aww... pooooor babies!

:eyes:

[stillwaiting]

4. My health insurance rates have been raised twice within the past 9 months.

Including both rate increases my rates have been increased by 58.22%.

NO sicknesses, NO major illnesses, on ZERO medications.

[HooptieWagon]

I understand most of big oil is self-insuring already. n/t

[mbperrin]

5. Hmm. Electric rates here have jumped 50% from 14 cents per kwh

to 20 cents.

These guys are gettin' off light.

[FreeJG]

6. crap, our hurricane insurance in florida went up more, for so much less damage in our state

[aquart]

7. Please tell me Big Oil is getting screwed by Big Insurance.