Buncefield - the insurance market’s black cloud?

The Buncefield oil explosion in southern England at the end of last year caused substantial damage. The joint operators of the depot, Total and Texaco, are the likely subrogation targets for the mounting property damage claims filed by local residents. In this article John Hanson , a partner at law firm Barlow Lyde & Gilbert representing personal and commercial insureds affected by the explosion, discusses liability and the legal cases that set precedent.

On 11 December 2005, possibly the largest explosion ever to occur in Europe took place at the Buncefield Oil Depot near Hemel Hempstead. There was immediate speculation as to cause, with possibilities including arson, terrorism, fuel leak, storage tank failure and pipeline failure. Early estimates put the damage at £300mn; at the time of writing, some estimates have now reached £1bn.