Oil rig insurance up, BP credit rating down

by Cedwyn

First off, everyone worried about BP's pension obligations to former employees can breathe a sigh of relief; expert consensus seems to be that BP has the bankroll to survive this.  If they heed the calls from Congress and elsewhere to forgo their $10 billion dividend payment, they probably will be fine for covering expenses.   Then again, no one appears able to agree on just what the total costs will be, especially since that's a function of just how much oil is leaked.  Hayward fantasizes that clean-up costs will be in the neighborhood of $3.5 billion.  * snigger *  Other analysts at Credit Suisse estimate closer to $15-23 billion, with another $23 billion in compensation claims.  There is agreement, though, that BP will come through this.  The question is, in what condition?

continued at Daily Kos....

BP Disaster – Insurance and Risk

by Sara R

A friend made the comment that BP was fully insured for the Deepwater Horizon loss.  I did some looking – and was shocked to find that, not only is BP self-insured by a captive insurer and it does not look like they reinsured.  I’ll get back to this momentarily – but wanted to share some questions first. If there were interested insurers in the picture, would mitigation of the loss be further along?  I’m curious. At the risk of comparing apples and oranges, I have a bone to pick.  It was recently mandated that the American people will be required to buy insurance on their own health.  Why then are large corporations not required to have the risks of their business better covered than BP’s well was, especially in such environmentally sensitive ventures such as off-shore drilling? Apparently, BP made a business decision not to purchase insurance and not to purchase reinsurance.  Did the company at all properly assess the amount of risk they were taking on themselves with their off-shore wells has the drilling been a blind gamble?

continued at Daily Kos....