NU Online News Service, June 16, 3:25 p.m. EDT

An Insurance Information Institute representative said thelikely administrator of a $20 billion fund for oil spill disasterclaims has the experience but will be challenged to develop a fair,timely process given the resources available.

With Gulf of Mexico oil spill estimates now up to 2.5 milliongallons a day, British Petroleum, at the urging of President Obama,has agreed to put $20 billion into a fund for Gulf oil disasterclaims, according to media reports.

President Obama said in a national address last night that hewould be meeting with BP officials today to discuss setting up sucha fund.

He described the oil spill disaster as an "epidemic," and said,"We will fight as long as it takes. We will make BP pay."

BP said on its website that it "noted the comments made byPresident Obama last night." BP confirmed it would be meeting withthe president to discuss his proposal for arrangements "to ensurethat all legitimate claims in respect in the Gulf of Mexico oilspill are paid out in a fair and timely manner."

Loretta Worters, vice president of communications for theInsurance Information Institute (I.I.I.), told NU Online NewsService that the likely administrator of the fund, KenFeinberg, is "probably more experienced than anyone in thesematters and that his challenge, as it was post-9/11, will be todevelop a fair and expeditious process given the resourcesavailable."

Mr. Feinberg was the special master of the federal compensationfund established for 9/11 victims.

The American Association for Justice (AAJ), formerly theAssociation of Trial Lawyers of America, called for such a fund ina recent statement. AAJ president Anthony Tarricone said that BPand other corporations need to be held accountable by setting up acompensation program.

According to I.I.I., insured losses related to the DeepwaterHorizon oil rig explosion and subsequent spill so far are expectedto fall between $1.4 billion and $3.5 billion.

Among the announced Deepwater Horizon insured losses, Lloyd'sreported $600 million in insured losses; Swiss Re, $200 million;Munich Re, $100 million; Partner Re, $70 million; Hanover Re, $53million; Validus Re, $45 million; Catlin, $40 million; XL Capital,$30 million; Aspen, $25 million; Chaucer, $25 million; AIG, $20million; Everest Re, $20 million; and Montpelier Re, $20million.

BP is self-insured.

Moody's Investors Service said in a report that insurance claimswill impact a number of lines, including: marine hull, marineliability, general liability, environmental/pollution liability,control of well, business interruption, directors and officersliability, and workers' compensation.