As part of the Fixing America’s Surface Transportation Act of 2015, the secretary of transportation is required to initiate a study of the levels and structure of insurance for railroad carriers who transport hazardous materials. A report showing the results of the study and recommendations for addressing the liability issues regarding railroad transportation of hazardous materials must be submitted to Congress within one year of the study.
PHMSA began the study in March of 2016. The three main areas being covered are the level and structure of insurance available in the private market against the full liability potential for damages arising from a railroad accident or incident involving hazardous materials, the level and structure of insurance that is both appropriate and necessary to efficiently allocate risk and financial responsibility for claims arising from an accident or incident, and the potential applicability for trains transporting hazardous materials, of an alternative insurance model, including a secondary liability coverage pool that would supplement commercial insurance.
Interested parties may submit comments until September 9, 2016.
