With Ohio courts already seeing dozens of chemical exposure suits from residents over the Feb. 3 derailment of a Norfolk Southern Railway train containing toxic materials, experts predict that myriad insurance policies will come into play in response to a variety of potential legal actions.
While current suits mostly seek damages or medical monitoring for exposure to vinyl chloride, suits over environmental contamination, business interruption losses and drops in stock price won't be far behind, experts say.
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Rhonda Orin, a policyholder attorney with Anderson Kill PC, told Law360 that there is no direct connection between government regulations for railways and insurance coverage. She said regulations often change more rapidly than the models insurance companies use for assessing risk.
"Regulations and insurance applications are on different tracks," she said. "Regulations come and go — probably quicker than the insurance companies' models for pricing risk."
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Anderson Kill's Orin said that based on the conclusions in the NTSB report, the derailment could likely be considered an accident for insurance purposes.
Orin, who has worked on environmental coverage for many decades, said no case has ever had the exact same solution. Thus far, she said, Norfolk Southern has acted as a "good corporate citizen" in responding to the derailment.
"What I got out of the report was that an accident happened," she said. "A number of safeguards were in place, and the safeguards worked. There was still an accident because accidents happen."
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