A natural gas-line explosion outside of San Francisco last month killed at least two people and severely damaged at least 53 homes, according to Risk Management Solutions (RMS).

The explosion took place on Sept. 9, 2010, in San Bruno, Calif., which is about 10 miles south of San Francisco and two miles from the San Francisco International Airport. RMS said the explosion “resulted in a fast-moving, gas-fuelled fire that has so far affected around 50 acres.”

RMS said that information from California's State Fire Department, along with a media statement from the San Bruno Fire Chief, indicate that at least 53 homes were severely damaged and up to 120 homes sustained some damage. The gas main was operated by Pacific Gas & Electric.

When asked to comment on related insurance and liability coverage issues concerning the gas main explosion, FC&S Editorial Director Diana Reitz, CPCU, AAI, offered the following analysis based on the information presented available:

“Pacific Gas & Electric undoubtedly will be asked to compensate the families of the victims who lost their lives or were injured in the explosion,” said Reitz. “The liability insurers or self-insurers for the entities that ultimately are deemed responsible will be expected to defend the claims that are filed against them. Of course, this assumes that the deaths did not involve individuals who were working on the line at the time it exploded. That would involve workers' compensation or employers' liability insurance.”

Reitz also said homeowners' coverage would be triggered by the event, and expects subrogation efforts to ensue.

“Regardless of where liability ultimately is placed, the homes that were damaged or destroyed should be covered by their respective homeowners' policies,” she said. “The homeowners' policies will be the first line of coverage for both the residences and their contents. These homeowners' insurers undoubtedly will then subrogate against whatever entities are deemed responsible for the explosion and subsequent fire. The liability insurers for the responsible parties will at the least have to defend these claims in addition to those filed for the deaths and injuries.”

Special Reports /

Coverage Analysis: Gas-Line Explosion

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