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  • Writer's pictureKirk Hartley

Underinsured and Risky – The Texas Fertilizer Plant Explosion

The West Fertilizer plant explosion in Texas killed 15, injured many more and destroyed or damaged dozens of adjoining buildings. Now, word is out through the LA Times that the plant operated with only $1million of liability insurance. One might conclude the owners at Adair Grain are irresponsible and/or were badly advised. One also could conclude there is a Texas-sized hole in Texas regulatory law. One suspects the same flaw exists for other large industrial plants in other states. It’s amazing that we see picayune state regulation in some areas, but also see holes this size with respect to an obvious risk. It will be interesting to see how the story unfolds, including what the insurance broker’s file show and what the D & O coverage looks like.

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