A wellsite or production fire is a lost-production claim, and the carrier's first move is the pollution exclusion.
Specialized equipment, lost production, environmental contamination, and the exclusions carriers reach for first each settle on different rules. The carrier's opening number rarely reflects the full loss. We document and negotiate all of it for the policyholder.
Start a claim review
Tell us what happened. A licensed Texas public adjuster will review the loss with you, and tell you straight whether you have a fight worth having. The review is free.
At a wellsite or production facility the equipment is rarely the largest number. The real exposure is the income lost while production is halted across the restoration period, the specialized equipment with long replacement lead times, and the contamination a fire or release can leave, which the carrier resists with pollution exclusions.
Replacing the equipment is one number. The lost production and the contamination fight are larger.
An upstream oil and gas loss, at a wellsite, drilling operation, production facility, or tank battery, combines flammable everything with constant ignition sources, and it produces two large exposures beyond the physical damage: the income lost from halted production, and the environmental contamination a release or fire can cause. The real fight is rarely just the equipment. It is the lost production over the restoration period and the carrier's instinct to invoke pollution and other exclusions to limit what it pays.
These claims are won or lost on the production-loss analysis and the coverage fight, not the cleanup. Standard policies and endorsements treat pollution, blowout, and equipment-breakdown exposures in specific ways, and carriers issue reservation-of-rights letters citing exclusions on exactly these losses. An upstream claim handled casually concedes the exclusion ground and undervalues the lost production.
Lost production / business interruption
Income lost while production is halted, often the largest component. Equipment and rig physical-damage coverages are frequently written with business-interruption coverage that replaces lost-production income.
Specialized equipment
Wellheads, pumps, separators, compressors, tanks, and rig equipment are specialized and slow to replace. Valuation and lead time drive both the property loss and the interruption.
Environmental contamination
A fire or release can cause contamination requiring cleanup. How that is covered - and the exclusions carriers raise - is central, and the cleanup cost can be substantial.
Exclusions and reservation of rights
Carriers commonly cite pollution, blowout, or equipment-related exclusions, often via a reservation-of-rights letter, to limit or deny. The applicability of those exclusions is contestable and has to be confronted.
The equipment loss is visible. The lost production and the contamination are where the money and the fight are.
An upstream fire or release damages specialized production equipment, but two larger consequences follow: production stops, and the event can leave environmental contamination that requires cleanup. The contamination in particular is where carriers concentrate their resistance, because property and liability policies treat pollution in specific, often restrictive ways, and a fire that involves a release sits right on the seam between covered fire damage and excluded pollution.
This is what makes upstream claims distinct: the carrier's opening posture is frequently a reservation-of-rights letter flagging exclusions that could reduce or deny the claim. If the loss, the production interruption, the equipment, and the contamination, is not documented thoroughly and the coverage analysis is not pressed, the carrier is left to resolve the claim on its own restrictive reading, and the operator absorbs the gap.
What we do about it
We document the full loss, equipment, halted production, and contamination, and where contamination is involved we bring in industrial hygienists and environmental expertise to establish what is present and what cleanup is genuinely required. On the coverage side, we treat fire-driven damage as fire damage and require the carrier to defend any exclusion's application to the actual facts, rather than accepting a reservation of rights as the last word.
The frame here is simple and it holds all the way through this claim: we document what actually happened. It just consistently turns out to be a great deal larger than what the insurance company's first scope assumed, because their method is built to see the obvious damage, not the full loss.
Lost production is the heart of the claim. The carrier wants the restoration timeline short.
For an upstream operator, the income lost while production is halted can dwarf the equipment damage, and it runs across the full time it takes to restore production. Business interruption, often written alongside rig and equipment physical-damage coverage, is meant to replace that lost-production income across the genuine restoration period, not the optimistic timeline the carrier prefers.
This is where carriers push hardest, because there is no single correct business-interruption number, there is a range of defensible ways to calculate it, and the insurer naturally reaches for the method that pays least. They will build one model on an optimistic restoration timeline and a baseline that happens to understate your normal operations.
How we push back
We do not hand the carrier one calculation and hope. We model the loss several independent ways - against your real production volumes and pricing, against equipment lead times and the time to restore production, against the realistic ramp back to full output, mapped to how your operation actually runs - and then use those models against each other to find and substantiate the presentation that most accurately captures the full impact. The carrier's single optimistic model is rarely the honest one.
A concrete piece of that: the look-back period. The carrier may favor a multi-year average because a soft year buried in it conveniently drags your baseline down. If a bad year is not representative of normal operations, a long look-back understates the real loss and a shorter window reflects the truth. Which baseline you use can move the number substantially, and it is exactly the kind of thing a policyholder would never know to contest. We do.
None of this is inflation. It is rigor. We build the most accurate picture of what the interruption actually cost you - and on these losses, the accurate picture is consistently and significantly larger than the carrier's first model, because their method is built to compress the timeline and shave the baseline.
The shortfalls in these claims are predictable. So is how we fight them.
Large losses in this sector are contested on a handful of recurring fronts. None of these mean the carrier is acting in bad faith, it means the policy is complex and the default reading of it favors the insurer unless someone pushes back with documentation. Here is what they try, and what we do about each.
On a loss involving a release, carriers reach for pollution exclusions to resist contamination cleanup, often citing them in a reservation-of-rights letter.
Our move: We treat fire-driven contamination as fire damage where the facts support it, document it, and require the carrier to defend the exclusion's application rather than conceding it.
The income loss turns on production volumes, pricing, and restoration time, and the carrier's accountant projects conservatively.
Our move: We build lost-production income from real production data and pricing, modeled multiple ways, and defend it against the carrier's deflated version.
Specialized wellsite and production equipment is undervalued and its lead time ignored.
Our move: We document replacement-cost entitlement and the true cost and lead time of like-kind equipment, so depreciation is not applied to property you are entitled to replace.
A reservation-of-rights letter flagging exclusions can chill a claim before it is fully presented.
Our move: We press the coverage analysis and document the loss fully so the claim is decided on its merits, not narrowed by an early reservation of rights.
The shorter the assumed restore-to-production timeline, the less business interruption the carrier owes.
Our move: We reconstruct the genuine timeline from equipment lead times and the ramp back to full production, and model the loss multiple ways to substantiate it.
The insurance company's adjuster works for the insurance company.
After a major loss, the carrier sends its own adjuster, and often a forensic accountant and engineering consultants, all retained by the insurer. They are competent and they are not neutral; their job is to resolve the claim on terms favorable to the company that pays them. A public adjuster is the licensed counterweight: we represent the policyholder only, we build and present the claim, and we negotiate the settlement.
On an upstream oil and gas loss the asymmetry is the whole problem. The carrier brings specialists. If the policyholder brings a contractor's estimate and hope, the outcome is decided before the negotiation starts. We level the table, document the full loss with the same rigor the carrier's experts bring to minimizing it, and we are compensated as a percentage of what we recover, so our incentive is your number, not theirs.
What happens after you call.
Loss review and policy analysis
We read the actual policy and endorsements - limits, BI and lost-production provisions, pollution and blowout terms, equipment-breakdown, exclusions and any reservation of rights - and assess the full scope before anyone commits to a number.
Document everything, including the contamination
Equipment, halted production, and any environmental contamination. Where contamination is involved we bring in industrial hygienists and environmental expertise to establish what cleanup is genuinely required, while the evidence still exists.
Build the lost-production claim, modeled several ways
From real production and financial data: volumes, pricing, equipment lead times, the restore-to-production timeline, and the right look-back baseline, modeled independently and used against each other to substantiate the full loss.
Present, negotiate, and settle
We present the documented claim, contest the predictable shortfalls - starting with the exclusions the carrier raised - and negotiate the settlement on your behalf through to resolution.
Questions upstream oil and gas operators ask
The carrier sent a reservation-of-rights letter citing exclusions. What does that mean?
It means the carrier is signaling that policy exclusions might apply, potentially reducing or denying the claim, while it investigates. It is common on upstream losses, especially where a release is involved, because policies treat pollution and certain operational risks in specific ways. It is not a final coverage decision. The applicability of those exclusions to your actual facts is contestable, and it has to be confronted with documentation and a coverage analysis rather than accepted as the last word.
Is the environmental contamination from the fire covered?
It depends on the policy, the endorsements, and the facts, and it is exactly where carriers concentrate resistance via pollution exclusions. A fire that involves a release sits on the seam between covered fire damage and excluded pollution. We document the contamination and the cleanup genuinely required and, where the facts support it, treat fire-driven contamination as fire damage, requiring the carrier to defend any exclusion rather than assuming it applies.
How is the lost-production loss calculated?
From your real production volumes and pricing, modeled several ways, across the full time it takes to restore production, including equipment lead times and the ramp back to full output. Business interruption is often written alongside rig and equipment physical-damage coverage for exactly this. The restoration period is the biggest variable and the carrier has every incentive to compress it. It is rigor, and the rigorous number is consistently larger than the carrier's first model.
Will the carrier pay full replacement cost on the equipment?
That is a common fight. Specialized wellsite and production equipment is often undervalued and its replacement lead time ignored. We document replacement-cost entitlement and the true cost and lead time of like-kind equipment so depreciation is not quietly applied to property you have the right to replace at full cost.
What does it cost to hire a public adjuster?
We work on a percentage of the recovery, with no upfront cost. We are only paid if and when you recover, which aligns our incentive with maximizing your settlement. Fee specifics are discussed up front before you commit to anything.
Tell us what happened. We will tell you straight whether you have a fight worth having.
No cost, no obligation. The fastest path is the phone - for a major loss, call and talk to a person today. A licensed Texas public insurance adjuster will review the loss with you.
713-369-4300Start a claim review
Tell us what happened. A licensed Texas public adjuster will review the loss with you, and tell you straight whether you have a fight worth having. The review is free.
A major loss is decided in the first moves. Make yours count.
Talk to a public adjuster who works only for you. No upfront cost - we are paid a percentage only if you recover.
713-369-4300Crossroads Insurance Recovery Advocates · TDI License 1924788
Don't take our word for it
- INSURICA: oil and gas industry coverage options - rig and equipment physical-damage written with business-interruption coverage that replaces lost-production income, plus pollution, blowout, and evacuation endorsements
- Leavitt Group / Great West: oil and gas energy program - property and business-interruption coverage protecting drilling equipment, pipelines, and storage against fire and explosion
- U.S. Securities and Exchange Commission filing (LSB Industries / El Dorado): a nitric-acid-plant explosion where the carrier issued a reservation-of-rights letter citing policy exclusions for potential denial of property-damage and business-interruption claims
- Rate.com: pollution liability insurance for oil, gas, and renewable energy - the 'sudden and accidental' requirement and how CGL policies typically exclude pollution events
- IRMI: the property-policy definition of pollutants and the absolute pollution exclusion