Philadelphia associate Joe Kelleher was quoted in an Insurance Journal article titled, “Fracking Drives NAIC Earthquake Conversation.” The article summarized an expert panel discussion that took place at the National Association of Insurance Commissioner’s Center for Insurance Policy Research’s Summer Event “All Things Earthquake.”  The panelists agreed that hydraulic fracturing, also known as “fracking,” was almost certainly linked to an alarming uptick in seismic activity in the United States.    

Fracking refers to a stimulation technique designed to increase oil and gas production that involves the injection of fluids into a well with sufficient pressure to fracture the underlying rock formations that contain oil and gas reserves.  Earlier this year, a number of insurance commissioners issued regulatory bulletins that cautioned insurance companies against relying upon policy exclusions for non-naturally occurring earthquakes due to the perception that the science linking fracking activities and increased seismicity was unsettled.   

Among other things, Joe pointed out that insurers who had issued policies excluding coverage for non-naturally occurring earthquakes had not priced for more expansive liability.

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