South Carolina Nixed Insurance for Train Victims Over Liability Fear

April 26, 2011

Legal advisers shut down a South Carolina fund proposed by Spartanburg County leaders and Gov. Nikki Haley’s office that would have paid medical bills for dozens of people hurt by a children’s train ride crash, according to a newspaper report.

After reviewing emails released under a public records request, the Herald-Journal of Spartanburg reported that organizers stopped the effort after a state Insurance Reserve Fund attorney said the plan could make the county uninsurable.

Twenty-seven people were injured and a 6-year-old boy was killed March 19 when the train ride hurtled off its rails at Spartanburg’s Cleveland Park. The official cause of the crash is still under investigation, and a state employee who admitted falsifying an inspection report days before the crash has been fired.

Local leaders proposed that the county and Haley’s office each put $1 million into a fund to pay medical bills for the injured people, many of whom were members of Gaffney’s Corinth Baptist Church.

“I cannot believe these families are having to worry about insurance issues on top of everything else they are dealing with,” Councilman David Britt wrote in one email. “I think we need to step up now and meet with them and let them know we will take care of these medical bills. This is our responsibility.”

Under state law, there is a $600,000 total limit to pay any claims they submitted to pay for bills and other expenses related to the crash. Lawmakers have discussed changing state law to exclude medical expenses from the liability cap that protects the government from paying unlimited damages, and an attorney for one family suing county and state officials for negligence has said he intended to argue that the $600,000 cap should not apply in this case.

The emails show that officials were preparing for a news conference to announce the fund to cover co-pays and deductibles for people injured. But Britt later told the paper that an attorney with the state Insurance Reserve Fund — which insures counties and other government entities — nixed that plan, saying that such a fund would make the county uninsurable and would make taxpayers liable for millions of dollars now and in the future.

“It was very frustrating and disappointing,” Britt said. “Here’s a county and state that wants to do something, but by trying to do what’s the right thing to help these folks, we were handcuffed.”

Jeff Caton, who oversees all of Spartanburg County’s parks, said he hoped the emails would show that officials started looking for a way to help people injured immediately after the weekend crash.

“That correspondence hopefully illustrates that we haven’t been sitting on our hands, and there is a real concern among all parties to do what we can,” he said. “We were just told by the attorneys that we can’t say anything to jeopardize our position. That doesn’t help anybody.”

A spokeswoman for the state Budget and Control Board, which oversees the Insurance Reserve Fund, declined to comment.

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