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Chubb Ltd. units are asking a Charleston, West Virginia, court to grant its summary judgment motion following a $32.6 million jury verdict in connection with its failure to pay damages related to a coal mine silo collapse.
Lexington, Kentucky-based Ramaco Resources LLC restarted mining facilities in Elk Creek, West Virginia, in 2012, employing nearly 300 workers, according to court papers in Ramaco Resources, LLC v. Federal Insurance Co. and Ace American Insurance Co., filed in U.S. District Court in Charleston.
Ramaco obtained a mining industries insurance policy from Chubb unit Federal Insurance in 2018 that covered direct physical loss or damage as well as lost business income and extra expense.
In November 2018, a silo used to store raw coal prior to its being transported by conveyor to a processing plant, collapsed. The silo, which was holding about 800 tons of coal at the time, was damaged to the extent it was later necessary to tear it down, the company said.
Chubb denied coverage in connection with the collapse, stating that the losses were caused by wear and tear, planning design, materials or maintenance that were not covered under the policy, according to the company, which filed suit against the Chubb units.
The $32.6 million verdict issued Friday comprised a $25 million award for breaching the insurance policy, $3.3 million for extra expenses, $3.8 million for business income loss and $532,941 in prejudgment interest.
The Chubb units filed a renewed motion for summary judgment the same day as the jury verdict.
The insurer argued in the motion that “aggravation and inconvenience damages are unavailable as a matter of law”; the aggravation and inconvenience claims are precluded by a “failure of proof”; and that the insurers have been prejudiced because of a failure to plead and disclose damages “with specificity.”
Attorneys in the case did not respond to requests for comment.