The collapse of the Francis Scott Key Bridge in Maryland is a multi-layered tragedy: For the families and friends of those killed or presumed dead, it's a profound and personal loss. For businesses that rely on the Port of Baltimore, it's an economic nightmare.
And for the federal courts, it will soon become a balance of dollars and facts, with a network of insurance companies expected to foot at least some of the bill.
The disaster happened early Tuesday when a cargo ship lost power and rammed into Baltimore's Francis Scott Key Bridge. Eight people were on the highway bridge when it collapsed. Two were rescued. The bodies of two more were recovered, and four remain missing and are presumed dead.
The wreckage closed the Port of Baltimore, a major shipping port, potentially costing the area's economy hundreds millions of dollars in lost labor income alone over the next month, according to the economic analysis company Implan.
A report from credit rating agency Morningstar DBRS predicts the collapse could become the most expensive marine insured loss in history, surpassing the record of about $1.5 billion held by the 2012 shipwreck of the Costa Concordia cruise ship off Italy. Morningstar DBRS estimates total insured losses for the Baltimore disaster could be $2 billion to $4 billion.
Here's a look the costs, the legal claims, and the insurance companies that will pay:
In federal court, the lost lives and damaged property will be stripped down to a matter of dollars and facts: Were the people or businesses who owned and operated the ship negligent in some way? Was anyone else partly responsible? How much will it cost to replace the bridge and make the families of the victims financially whole?
Insurance companies will ultimately be on the hook for at least part, if not all, of the total cost.
Enrique Serna, an attorney who specializes in representing immigrant laborers and others hurt on the job, said his firm was contacted by some of the victims' families shortly after the collapse, though he was not yet representing them. The crew filling potholes on the bridge had come from El Salvador, Honduras, Guatemala and Mexico, some of them decades ago.
Serna said lawsuits are inevitable, and the ship's insurers will likely soon seek a "limitation of liability," asking a judge to cap the damages they can be ordered to pay. The victims will need to quickly respond to try make sure any cap isn't set too low.
"What happens is, it's a race against time for when you can present a claim for it," Serna said.
Attorney Thomas Schoenbaum, a maritime law expert and professor at the University of Washington, said despite significant economic damages, impacted businesses will not be able to sue the ship's owners and operators.
"There's generally bad news about that: In maritime law, pure economic loss damages are not recoverable. If you have an economic loss, losing money, or a business shuts down, or a business loses customers, unless you have some physical damage along with the economic loss, maritime law says there's no recovery," he said.
The one exception is for loss caused by pollution, like an oil spill, he said, and the bridge wreckage doesn't count as pollution under maritime law.
Charm City Warehouse owner Bernard Sommer, whose Baltimore-based business serves shipping companies needing to store cargo containers, expects to sustain heavy losses as long as ships are being diverted to other ports.
"If they get that open in 30 days, we're going to have 60 to 90 days loss of business. And for them to do it in 30 days is pretty quick," he said. "Until this channel is open and shipping, they're not going to show any service into the port of Baltimore."
Sommer said he hasn't yet contacted his insurance company to ask if his policy covers losses related to the Baltimore port's closure.
"If the building caught on fire and we weren't able to operate, or something like that happened? Yeah, that's covered. But I don't know if something like this is covered," he said. "It's hard to tell. When you sign up for insurance, they give you one page of everything they cover. And that is followed by 45 pages of everything they're not going to cover."
On Friday, Atlantic Maritime Ship Supply had to dispatch a truck to Newport News, Virginia, to serve a ship originally bound for Baltimore. Owner Edward Dryer also hasn't checked his insurance yet -- he's waiting to see if his operations will be significantly impacted.
He expects the port to gradually reopen in weeks, not months.
"Let's be optimistic that they are able to reasonably quickly get the channel at least partially open," Dryer said.
Experts say replacing the bridge could cost $400 million or more.
Ships and other maritime vessels often have more than one type of insurance. They frequently have policies that cover damages to the hull or machinery, and might also have coverage for cargo carried by the ship.
But for other very expensive losses -- like major environmental damage or disasters like the bridge collapse -- large vessel owners turn to something called "Protection and Indemnity" or P&I insurance.
P&I insurance can be provided by "clubs" made up of several policyholder-owned insurance companies. Club members put money toward a pool of funds that can be used to cover catastrophic claims. The idea is to share the risk associated with major disasters so no company is left to bear it alone.
Insurance clubs may also buy their own insurance to cover expenses that are too big for the pool to handle alone. That's called "reinsurance" -- the club is the first insurance that pays out, and then the second payer is the "reinsurance."
The Britannia P&I Club insures the ship involved in the collapse. The London-based club is also part of the larger International Group of P&I Clubs, which will likely help cover expenses once they exceed a pre-arranged amount. Reinsurance companies could also pick up part of the tab.
