Accidental losses led to end of insurance for Washington State Heritage Railroad
Broker says Chehalis-Central Railroad & Museum board’s failure to obtain insurance is ‘unprecedented’
CHEHALIS, Wash. — Documents detailing more than $1 million in losses over a 6-year period led to the Chehalis-Centralia Railroad & Museum’s inability to obtain liability insurance, the railroad’s insurance broker said heritage railway earlier this week at an emergency meeting of the railway’s board of directors.
Lack of insurance forced the railroad to suspend operations and put its future in jeopardy.
The Centralia Chronicle reports that the broker, Tripp Salisbury of Borden Perlman McRail, called the inability to obtain insurance “unprecedented” in his 40 years in the business. “I’ve never seen this in my entire career, where we couldn’t get… renewal coverage for a client.”
The current insurer declined to quote a renewal, and the other three companies that provide rail liability insurance have followed suit, Salibury said at Monday’s meeting. He said that decision was based on the railroad’s “loss streaks,” documents used for underwriting that detail losses. The organization lost $1.064 million over six years due to two accidents involving Chehalis Central trains. One was a fatal accident in July 2017 when a man failed to yield to a train; the other, in October 2019, involved a man who crashed into a train while reversing. A lawsuit for this latest accident remains active.
The railway suspended operations from Saturday when its previous operating insurance expired [see “Washington state heritage railroad suspends operations,” Trains News Wire, March 7, 2022]. Salisbury said at Wednesday’s meeting that the first step in resuming operations would be to gain accountability for the premises, which would protect the organization’s property, including its former Milwaukee Road right-of-way, and all rail operations. not paying.
But it could take six months or more to get full liability insurance, and will likely require organizational changes, such as a larger business structure, Salisbury said. Still, he said, he didn’t believe the insurance issue would be “a deathblow” to the organization.