Texas Disaster Shows Legally Required Insurance May Not Be Enough

Carrying voluntary liability insurance as a protective measure would help companies avoid the difficult circumstance that Adair Grain, Inc. and CF Industries are in, as they face a lawsuit from the Texas town that saw a fertilizer plant owned and supplied by the companies explode in April 2013. Adair Grain’s West Fertilizer Co. plant explosion in West, Texas, destroyed hundreds of homes and injured more than 200 people, including employees who were allowed to work without proof of insurance. West Fertilizer’s $1 million in liability insurance coverage, while meeting state requirements, won’t come close to covering damages, and the lawsuit holds Adair Grain and CF Industries responsible for inadequate management and poor risk management strategies.