The earthquakes in Syria and Turkey, an offshore oil spill or the careless abandonment of a wildfire are some examples that provide newsworthy headlines while also introducing various claims and concern for loss adjusters to assess.
The train derailment and the subsequent fire of the chemicals contained in the cargo in East Palestine, Ohio, is another recent event that has various implications for the insurers and more importantly, the residents of the town.
Proceed with compassion
For Michael J. Law, vice president at Crawford Global Technical Services and a loss adjuster with years of experience in the field, the first and most important step in assessing a situation like that in Ohio is approaching it with a good attitude.
“When you’re dealing with people who have experienced this type of event, the most important thing to have is empathy, right away,” Law said. “You have to put yourself in their shoes and understand the deep frustration and inherent fear that these people are experiencing right now, especially with all the variables and unknown outcomes as a result of this derailment and the combustion of harmful chemicals.”
From an insurance perspective, a loss adjuster must understand how the whole town will be affected, especially for both property owners and businesses.
“No one goes to restaurants, buys anything at convenience stores or gets gas, which puts a strain on local operations that can continue to provide services” Law pointed out.
“People also need to reassess if moving to another town, but where do they go if their biggest asset is worthless? The mortgages still have to be paid.”
Unusual events
While natural disasters of varying severity have become commonplace in modern times, instances like this one in Ohio are a relative anomaly.
“We’re used to seeing natural events, whether it’s hurricanes, ice storms especially in places where they don’t happen often, as well as damaged buildings,” Law said. “But this tragedy in Ohio is unique and you have to worry about the long-term effects on the town. Will people’s businesses come back, will the land be deemed toxic and uninhabitable?”
After tracking the situation from various news outlets and first-hand accounts, Law observed that “on the homeowner’s side and personal lines say, we’re seeing cars and houses with a lot of soot accumulated.”
However, these more aesthetic concerns pale in comparison to the more pressing environmental impacts. Residents are tired of trusting the air they breathe and the water they are told is safe to drink, which unfortunately, is not an easy solution for insurers or health officials.
“There will likely be a lot of water and air quality testing for the next several months and even then, we still may not know what the long-term health risks will be,” Law said.
“I go home and I’m not safe. I don’t want to get sick when I go to my house. That’s my home. I live there. My son grew up there,” one East Palestine mother said. https://t.co/qAzRGuM21C
— ABC News (@ABC) February 27, 2023
This can lead to a significant drop in property values while also alienating townspeople from important business exchanges including real estate and travel.
Timeline not specified
Events that involve ecological impacts beyond physical destruction usually have a more hypothetical framework for how long and difficult the path to a solution will be.
Pointing to an earlier incident, Law recalled the 2010 BP Deepwater Horizon oil rig explosion that killed 11 and spilled hundreds of millions of gallons of oil into the Gulf of Mexico. “It took five or six years for the area to bounce back,” he said. “It’s not just about fishing, but air and water quality, as well as impacts on surrounding businesses.”
Similarly, it will likely take some time for the full extent of any entropic land, health or economic impact to be concretely assessed in East Palestine.
“Ultimately, it’s probably going to be a combination of both private industry and government resources that will speed this up as much as possible so we’re not talking about this event nine months from now,” Law said.
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