?Next month, the?Dallas City Council will have to decide whether to allow fracking?within Dallas city limits ? an?issue that has split communities all across the nation. ?
They may want to take the temperature of the insurance industry. Nationwide Mutual Insurance Co. has become the first major insurance company to say it won?t cover damage related to fracking.
?As I interpret? the? insurance company?s position, fracking will be considered a ?prohibited risk,?? meaning that if? John Q. Landowner allows drilling on his property, then he?may not be covered from damage from fracking.?The dynamics and economics?of the? fracking debate? would? change if other insurers follow this lead.
?What do I mean??To date, the argument, against fracking in urban areas has revolved around noise, general safety concerns posed by?an industrial use close to homes,??possible groundwater contamination and impact on?property values.
?Until now, we really haven?t heard from the insurance industry. So does this mean that? if an earthquake from?an?injection well? damages?a?foundation that the repairs won?t be covered? Will insurers treat coverage?not on an individual basis but as a zone, which is the way they treat coverage of earthquakes and floods, if they offer it at all.
The?drilling? industry?s response has been to call the announcement ?reckless? and it is so unusual that?enviromentalists ?aren?t sure what to make?of, either.??I?quickly looked?at the?insurer?s website for the actual wording of the statement and ironically it doesn?t seem to be there. They story is moving all over the Internet and I?ve not seen anything of a reaction or clarification from ?Nationwide.? I?ve e-mailed them?for elaboration and will post whatever I receive.??????
?Nonetheless, this should be something the Dallas City Council needs to think about? as it considers fracking rules in August.?At the very least, it is?another reason? for Dallas to say ?no? to injection wells?,which recent studies link to the run of?earthquakes in North Texas.????????????????????????
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