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Over 100 insurers sue Texas electric authority, utilities over 2021 winter storm damage

The Electric Reliability Council of Texas (ERCOT) and several local power companies in the state are facing a massive lawsuit filed by more than 100 insurance companies over damages related to the grid failure that occurred during the February 2021 winter storm.

Filed in Travis County, the lawsuit alleges that ERCOT is responsible for the power failure last year, additionally claiming that the issue was entirely preventable. According to the lawsuit, ERCOT “failed to adequately prepare for the 2020-2021 winter season, and in fact, planned to fail.”

The February 2021 power outage led to more than 500,000 insurance claims and over 200 deaths. It was estimated that insurers were anticipated to pay more than $10 billion for damages related to the outage.

“The point of this lawsuit is to recoup those costs,” Insurance Council of Texas (ICT) director of communications and public affairs Rich Johnson told FOX4.

ICT is not involved with the lawsuit.

Johnson also explained that while such a lawsuit against utility companies is uncommon in Texas, it has been done in other states.

Read more: Four insurers file lawsuit against power company for negligence

“I know, in California, there have been a couple of lawsuits that have actually been settled with insurance companies and their power companies due to wildfires in 2017, 2018,” the communications director said. “There were some massive wildfires where it was discovered that lack of maintenance caused many a couple of the wildfires.”

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