Pollution losses in Europe

1
Pollution losses in Europe

• Jürg Busenhart
• Swiss Reinsurance Company, Vice President

2
Accidents with environmental impact
Sandoz AG Schweizerhalle 1986CHF 140m
Buncefield fuel depot 2005 600m
Doñana/Boliden 1998 180m
3
Schweizerhalle Switzerland (1986)
4
Schweizerhalle SwitzerlandEvent

• Fire in warehouse (agriculture chemicals)
• 10000 to 15000 m3 contaminated fire
  extinguishing water (including 10 tons of
  insecticides)
• Fumes caused a public nuisance ? not toxic
• Damage to the marine life of the Rhine from
  Switzerland down to the Netherlands
• Drinking water suppliers downstream closed for 18
  days

5
Schweizerhalle Switzerland Measures/claims

• Emergency measures like
• recovery and cleaning up of debris (2695 tons)
• installation of asphalt surface over the fire
  area to avoid groundwater contamination due to
  rain
• cleaning up of riverbed by scuba diver ? several
  thousands m2 1 ton of chemicals
• Remediation/clean-up (soil beneath/below
  warehouse)
• goal avoid groundwater contamination
• Compensation of third party liability claims
• 1100 claims from CH, D, F, NL
• alternative drinking water supply
• gathering of dead fishes, compensation to fishing
  associations and federations, restocking
• ecological monitoring

6
Schweizerhalle Switzerland Overview of costs
Type of costs
Cost in CHF mio.
Costs borne by
Third party liability TPL goodwill funds Property
damages to buildings,good and installations Recov
ery and cleanup of debris Remediation/clean-up Tot
al
42 1 17.8 20 60 140.8
Insurance Company Insurance Insurance Insurance/c
ompany Mainly Insurance
Source Sicherheit undUmweltschutz bei Sandoz,
Oktober 1996
7
Doñana/Boliden Spain (1998)
8
Doñana/Boliden Spain Event

• Tailing dam break
• Escape of 5000000 m3 of toxic tailings slurries
  and liquid
• Contamination of 40 km of rivers incl. 200 m of
  each river embankment ? Aquatic life depleted
• Contamination of 44 km2 (9865 football grounds)
  land incl.
• 3.4 km2 of farmland (corn, rice, cotton, olive,
  pasture)
• 8.6 km2 of forests, gravel pits, shore land
• Impact on Doñana Nationalpark

9
Doñana/Boliden Spain Consequences

• 37.4 tonnes of death fishes
• 96 vertebrates killed
• 5000 geese and 20000 water birds affected
• Excavation of 12 mios tonnes of contaminated
  soil
• Economic loss EUR 377.7 mios where as
• decontamination of soil EUR 145 mios
• remediation of water course EUR 136.7 mios

10
Doñana/Boliden Spain Hypothetical cost
allocation to ELD
11
Buncefield fuel depot UK (2005)
12
Buncefield fuel depot UK Event

• Explosion and fire at the Buncefield fuel depot
  gt Britain's biggest peacetime explosion
• Overflow from the tank led to the rapid formation
  of a rich fuel and air vapor gt human error and
  faulty safety equipment
• Further explosions followed and a large 3 day
  fire took hold, eventually engulfing 20 large
  storage tanks
• Impact
• Bodily injuries 43 people were injured
• Third party property damage 20 buildings
  destroyed, 60 badly damaged
• Business interruption All 630 businesses nearby
  were disrupted
• Environmental damage air pollution,
  groundwater/river pollution

13
Buncefield fuel depot UK Consequences

• Many companies in the blast zone were affected by
  the incident (eg. destroyed/damaged buildings, no
  access to the plants, destroyed valuable stock
  and data)
• Unable to service clients
• Number of surrounding companies did not have any
  contingency plans for operating
• 2000 people were evacuated
• Estimated damages in excess of 500m for third
  party property damage and business interruption
• Damage of 130m at the fuel depot

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CEA Schweizerhalle/Doñana case studyFindings/conc
lusions

• Detailed financial cost information for
  environmental accidents from the past is rarely
  available
• If available they do not specifically
  distinguish between
• the costs for
• emergency/mitigation measures,
• clean-up of own property,
• the restoration of environmental damage and
• the compensation of third-party liability claims
• Difficult to use these historical information to
  establish reliable statistical data that could
  be used to predict the cost of future losses
• To support predictability/ insurability, it is
  recommended to elaborate scenario based case
  studies and try to build up hypothetical
  estimations of costs

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