Despite “uninsurable” objections, US moves to scrap limit
The American Petroleum Institute has warned that proposed Senate legislation to make oil companies liable for unlimited damages in the event of a spill because it would make getting insurance impossible, the FT reports.
It cited a letter from insurer Lloyd & Partners that said “any significant increase” in liability would force companies to self-insure, because the insurance market would not have enough capacity to cover clean-up costs and other damages.
The bill passed by the Senate environment committee on Wednesday removed a $75m cap on liability for damages from oil spills. It would apply retroactively to BP and will go to the full Senate for consideration.
Law prevents compensation
Kenneth Feinberg, the independent administrator of BP’s $20bn compensation fund said state laws, particularly in Florida, did not support the payment of claims to people or businesses not directly affected.
“Clearly under Florida law, it is not a compensatable claim if there is no damage to the beaches and it is [an issue of] public perception,” he said.
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