Case Studies

Several explosions broke out in the Waste Heat Recovery Unit (“WHRU”) at one of the Insured’s Gas Separation Plants (GSP). This resulted in adverse impact on various of the Insured’s businesses including: i) Pipeline (upstream); ii) GSP (midstream); and iii) Olefin & Polymer (downstream).

Over the past several years, many catastrophic wide area events have impacted various island nations, creating challenges within our industry from a loss adjustment and measurement perspective. The below case study is an agglomeration of many recent catastrophic events involving several power generation business interruption losses.

The subject of this case study is the operator of several wind farms that supplied the generated electricity to a large industrial customer under a Power Purchase Agreement. The wind farms were all connected via overhead transmission lines to a substation on the boundary of the industrial customer that contained two transformers with the same rating.

Freezing temperatures and an intermittent power supply caused a refinery shutdown for almost a month before returning to normal throughput levels. As a result, the insured was forced to sell incoming crude oil and purchase finished product to fulfill their sales requirements.

A coal-fired power plant in Asia had two identical units. Plant operators discovered an issue with Unit 1's generator that they estimated would take six months to rectify. A month later, they found Unit 2 also suffered from the same underlying problem, despite operating as usual. As such, the plant also took Unit 2 out of operation.

As a result of a fire in its vacuum distillation unit, a refinery suffered a period of downtime in its crude unit, vacuum distillation unit, diesel and naphtha hydrotreaters and gasoline reformer. The refinery was able to process limited feedstocks during this period.