The deadly derailment and explosion of a train carrying crude oil through a small Canadian town is expected to lead to increased insurer scrutiny of the rail transport of hazardous materials, but is unlikely to dramatically affect rail insurance rates outside of tighter limits for small railway companies.

Moving crude oil and other petroleum products by rail increased dramatically in recent years and is expected to continue increasing along with the U.S. crude oil production boom.

Aside from at least two dozen confirmed dead as of Friday, more than 30 buildings in Lac-Mégantic were destroyed and about 1,000 people were forced to evacuate, after the train cars derailed and subsequently some of the cars exploded. A criminal investigation was underway last week, as the search for some two dozen missing people continued. The disaster was Canada's worst railway catastrophe in about 150 years, according to news reports.

Dublin-based XL Group P.L.C. is the lead insurer for the Hermon, Maine-based rail company Montreal, Maine & Atlantic Railway Corp., sources said. “We are on the scene working closely with the company and authorities and our thoughts and prayers are with the community of Lac-Megantic,” XL officials said in a statement last week.

Edward Burkhardt, chairman of the Montreal, Maine & Atlantic, and president and CEO of its parent company, Rosemont, Ill.-based Rail World Inc., reportedly said the train engineer, who was suspended without pay, may have been at fault for not applying all 11 hand brakes on the train.

The train was carrying crude oil from North Dakota to a refinery in Saint John, New Brunswick.

Anthony Swift, an attorney with the Washington-based Natural Resources Defense Council, said the reason for the increased use of rail to transport oil is that the Bakken oil deposits of North Dakota and southern Alberta are not traditionally served by pipelines.

Experts also say transporting crude oil via rail could increase further if President Barack Obama decides against the proposed Keystone XL project, a 1,179-mile crude oil pipeline that would run from Hardisty, Alberta, to Steele City, Neb.

Meanwhile, lawsuits are expected in the aftermath of the rail disaster. Jonathan Dryer, a partner with law firm Wilson, Elser, Moskowitz & Dicker L.L.P. in Philadelphia, said in addition to the railway, possible defendants include Miami-based World Fuel Inc., whose oil the train reportedly was carrying. A World Fuel spokesman could not be reached.

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Manufacturers of the tankers involved in the explosion also could be defendants, Mr. Dryer said. While tankers made since 2011 have been built to higher industry specifications, U.S. regulators have not adopted those standards. “They're negotiating retrofits for the older cars, but that has not been made mandatory yet,” he said.

Keith Stewart, climate and energy campaign coordinator for Toronto-based Greenpeace Canada, said one concern is that about 70% of the tanker fleet are older DOT-111 tank cars that rupture easily when there is a derailment. Older tankers “shouldn't be allowed to carry petroleum products,” he said.

But James Beardsley, Washington-based managing director and global rail practice leader for Marsh Inc., said the railway cars being used have been accepted and certified under existing rules by the Federal Railroad Administration.

“I think the ongoing risk assessment of hazardous materials will be heightened following what happened,” but there will be no significant change in the insurance market, said Daniel Bancroft, New York-based senior vice president and transportation practice leader for Willis North America Inc. “The expertise that exists in the railroad underwriting community is such that I don't see them changing their direction.”

Many rail underwriters, often with 20 to 25 years of experience, have worked with the same companies their entire careers. “That continuity and that knowledge and those relationships, I think, are going to weigh more heavily than a single catastrophic event,” Mr. Bancroft said.

While there will be some pressure on rates, particularly on railway companies involved with the Quebec rail disaster, it will not substantially affect pricing “in a dramatic way,” Mr. Beardsley said.

However, Stefan Schmitt, Munich-based corporate insurance partner and head of section North America liability at Munich Re Risk Solutions, said, “It will be a very large loss for the industry for the smaller” railway firms whose coverage limits “will presumably be less.”

Mr. Schmitt said the larger railroads “are experienced in that field, analyze what kind of (hazardous materials) is on the tracks and they have considered this.”