Insurance companies that total more than 100 are seeing the power grid operator in a Southern state and city plus dozens of power generators. Also losses and property damage which is sustained during the Winter storm last February.
Insurance Companies – Energy Failure and Power Loss
The Travis County District Court where the lawsuit was filed said the Electric Reliability Council of Texas (ERCOT) and 37 other power generating entities were “at fault” for the energy failure and powerless leaving millions of Texans in the cold and dark for days. Moreover, it does allege there was gross negligence. Also, when these defendants “failed to plan and prepare for the winter storm event. In fact, the energy failure did cause substantial property damage to the policyholders of plaintiffs.”
Insurers did indicate they had 500,196 insurance claims. Based on the latest report from the Texas Department of Insurance. Also, more than 85% of the claims did come from residential property owners and homeowners. In fact, commercial properties did makeup just under 10% of those claims.
The insurers were expecting to eventually pay about $10.3 billion in losses from this event. This was based on a report estimated as of July 31, 2021.
The Federal Energy Regulatory Commission issued a report cited by the lawsuit. It does conclude the power generators did fail to heed its prior warnings to winterize their equipment and the facilities in the preparation for winter. Also, these insurance companies did demand a jury trial. Also, they have asked the court to consider a term that is called “subrogation.”
Insurers can recoup the costs. The subrogation allows an insurer. That is even at the customer’s deductible, from the at-fault party.
There are similar lawsuits that are playing out in other West Coast and Western states. That is what Rich Johnson with the Insurance Council of Texas said. It was after huge wildfires did rip through those states. Plus destroying homes and businesses.
Paying their Part
“This is where the insurance companies have banded together. Thus to look for the responsible party. Moreover, which did happen to be the power companies. Then look at those areas for lack of maintenance on power cables,” he said. “Also, if you did want to find the party, that’s at fault, and if they’re responsible, they should pay their part.”