| MADRID/LONDON, July 26
MADRID/LONDON, July 26 Germany's Allianz
and Australian group QBE bear the bulk of the
insurance liability from this week's fatal train crash in
northwest Spain, according to sources at the companies.
While Allianz's Spanish subsidiary covers a compulsory
personal accident policy for Spain's state-owned rail network
Renfe, QBE covers injury to third parties and rail
infrastructure, if the train operator is found to bear
responsibility, the sources said.
The train driver was under police guard in hospital on
Friday following the crash, which an official source with
knowledge of the investigation said was caused by excessive
A judge in Santiago de Compostela, capital of the northern
Spanish region of Galicia, was assigned to investigate the
accident. The judge ordered police to question the train's
driver, 52-year-old Francisco Jose Garzon.
The crash killed 78 people, and authorities in Galicia said
95 people were still in hospital, 32 of them, including four
children, in a serious condition.
The source at QBE said the firm has not yet produced an
estimated insured loss from the accident as the cause of the
crash remains unclear.
According to previous statements, QBE says its exposure to
any single public event is limited to $50 million under its
reinsurance arrangements, whereby insurers sell risk to other
parties to hedge their own liability.
A QBE spokesman in Sydney said he could not immediately
comment on the matter.
Allianz's Spanish unit Allianz Seguros released a statement
on Thursday confirming it underwrote the Renfe policy and that
it had implemented an action plan and sent a team of experts to
the accident site.
While the insured loss for physical damage to infrastructure
and property is likely to be resolved quickly, compensation
claims by victims and their families could take years due to
lengthy legal processes.
Local businesses may also claim compensation for loss of
revenue caused by disruption to the rail network.
Payouts will depend on liabilities, whether the accident was
the fault of the driver or whether there is a case for corporate
negligence on the basis the train should have had fail-safe
mechanisms in place to limit speed.