Petrobas, Brazil’s state owned oil company, announced that it has finally been able to renew its insurance coverage, which was due to expire on Saturday, but with a rate increase of over 650 percent above the $7.5 million it paid last year to $48.8 million.
The increase is largely due to the losses suffered earlier this month when an explosion and fire ripped through the world’s largest oil rig, killing 10 workers, and resulting in a total loss when the structure sank. Det Norske Veritas, a Norwegian company specialized in surveying and assessing seaworthiness, is currently investigating the cause of the disaster, and is expected to issue a preliminary report next month.
According to a report from Reuters News Agency, a consortium led by Brazilian insurer Bradesco Seguradora had submitted the lowest million bid. It actually covers only one percent of the risk, the remaining 99 percent is covered by non-Brazilian companies, mainly through the Lloyd’s market.
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