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W.R. Berkley: Oil Rig Premiums Up 40% After Disaster

Posted on 27 May 2010

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Property and casualty insurer W.R. Berkley Corp is boosting premiums on deep water oil rig insurance by 40 percent after a massive spill at the Transocean drilling rig in the Gulf of Mexico, the insurer's chief operating officer said on Tuesday.

Berkley was an insurer of the Transocean rig, and has paid out $25 million on it, but after reinsurance, its net payout is $5 million.

W.R. Berkley believes it was charging the right price for deep water oil rig insurance, but is charging higher prices now that it better understands everything that could go wrong on a rig, said W. Robert Berkley in a meeting with reporters.

"It's been a learning experience," Berkley said.

An April 20 rig blast killed 11 people and unleashed a gushing oil leak that BP Plc is still hoping to plug. Transocean owned the rig, while BP owns the oil well.