BP rig explosion likely to cause hardening in offshore and onshore accounts

Insurance premiums for both offshore and onshore accounts will likely increase immediately, even though it could take years to determine the total insured loss resulting from the British Petroleum oil rig explosion in the Gulf of Mexico, reports MarketScout.“British Petroleum is largely self-insured; however, energy underwriters across the globe will participate in this loss via either excess placements, insurance on the non-operators (investors), drilling contractor or blowout prevention manufacturer,” said Richard Kerr, CEO of MarketScout.“Even though onshore insureds may feel they should not suffer because of offshore losses, they too could be [affected],” he said. “Many onshore insurers have some offshore exposure and may try to capture rate increases across the board.”