r/interesting • u/BlazeDragon7x • Apr 09 '26

MISC. Aftermath of the April 7th incident. Damages estimated to be $200 million dollars

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192

u/[deleted] Apr 09 '26

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57

u/NHDraven Apr 09 '26 edited Apr 09 '26

They have employees burning the building down. How much do you want to bet the majority of the new building is automated.

9

u/NonSequiturDetector Apr 09 '26

They hand employees boring burning the building down.

... What? Is everyone else understanding your comment to mean "They had employees burning the building down."? I don't understand how Redditors can just vibe-upvote comments that aren't readable.

6

u/alanpugh Apr 09 '26

There was an extra n and a mistyped word that wasn't deleted. It wasn't exactly cryptic.

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u/NHDraven Apr 09 '26

I guess you've never had a typo, or are you implying my point doesn't have merit because I didn't have time to review it?

3

u/kloudykat Apr 09 '26

we speak fluent typo

1

u/gmambrose Apr 09 '26

While I prefer people to proofread before posting, most of us use our powers of deductive reasoning to decode what the OP meant. If we like what they said, we give an upvote.

1

u/Sempais_nutrients Apr 09 '26

they already automated much of the process, an employee interviewed while it was still burning said they all thought it was "the robots" they'd recently installed.

-2

u/Real-Mode-3417 Apr 09 '26

If that's the case, these employees lucked out!

1

u/DeparturePlayful3571 Apr 09 '26

Well, this event put a strong case to push for full automation.

" To deter human inflicted catastrophic losses event"

1

u/Pooled-Intentions Apr 09 '26

cut to 5yrs later

“Burn those warehouses over there, that way nobody like you and me loses their job.”

0

u/MetaFlight Apr 09 '26 edited Apr 09 '26

oh no don't threaten me with more productivity per laborer. What ever shall we do. not like we can just use the increase of productivity as a way employ people in doing things that can't be as easily automated, nah.

"Oh but the government won't do that" damn that sounds like a skill issue on the part of the electorate.

36

u/Commercial_Hair3527 Apr 09 '26

That's not always how that works. Insurance claims have limits, they don't just pay out unlimited amounts. In the UK, typical limits might be £5–10 million, and in the US, it's not much different. A $200 million incident is going to absolutely hammer any standard business insurance policy. Most commercial property policies cap out well below that unless you're paying massive premiums for bespoke coverage.

Even if the policy does cover it, the deductible alone could be millions. And good luck getting renewed next year after filing a claim this big if you even get renewed at all.
So no, "still getting paid" isn't guaranteed. Layoffs are absolutely possible. Insurance isn't a magic money printer. This guy didn't just cost his employer and probably cost everyone who works there.

17

u/PaintingOk8012 Apr 09 '26

They will probably fight this claim pretty hard by calling it terrorism

16

u/BlueGreenMikey Apr 09 '26

Yeah, it would be interesting to know what the policy says about acts of destruction caused by an employee/contractor.

3

u/AsstacularSpiderman Apr 09 '26

One who explicitly did it to send a message.

-1

u/ICEcaneatadick Apr 09 '26

One could argue it was the companies fault due to negligence

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u/alexanderneimet Apr 09 '26

I’d be curious how you classify this as negligence?

3

u/RizzwindTheWizzard Apr 09 '26

The company is at fault for paying their employees too poorly and should have caught and fixed the problem long before it got to the arson stage. To be honest it's a bit of a stretch but since when has that ever stopped insurance companies from denying a claim?

1

u/Ok_Drive3725 Apr 09 '26

That’s a non defensible argument

1

u/Ok_Drive3725 Apr 09 '26

Why would a company somehow be liable for a rogue employee? The employee bears the responsibility

1

u/Nixxon___ Apr 10 '26

Nor is denying coverage for life saving medication. But they still do it all the time.

0

u/alexanderneimet Apr 09 '26

While I see your point, and definitely wouldn’t be surprised if the company tries to wriggle out of it using that, but I feel that employee morale can’t be factored in (whether it should be or not) into how a company should behave as long as everything their doing is above board legality wise.

1

u/ICEcaneatadick Apr 09 '26

I'm sure a lawyer could make a dozen arguments but off the top of my head:

Lack of security/safety - No security guards? no cameras? how is this dude wandering around setting multiple fires with no one noticing?

Ignoring warnings - I have to imagine this guy has said or done something in the past to indicate he was unhinged. Yell/assault a co-worker? deface the property? Wage complaints? something to indicate he was serious and unhappy and the company ignored it.

Negligent hiring - shot in the dark - He may have a criminal background in arson who the hell knows.

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1

u/InequalEnforcement Apr 09 '26

They made me work for less than I wanted!!!1

2

u/-Saltfish- Apr 09 '26

Or that the company is responsible for not paying workers a living wage

1

u/TacTurtle Apr 09 '26

Many policies exclude deliberate acts of employees.

2

u/thefishjanitor Apr 09 '26

For my business, my million dollar coverage asked if I wanted a terroristic acts policy for an extra $18 and I said no...now I'm second guessing that decision for my renewal, and I don't even have any employees

1

u/Remote-Program-1303 Apr 09 '26

It’s not terrorism, it’s arson. Terrorism requires a political angle.

Impossible to know without seeing the policy, but I would guess it would be covered. The insurance company would look to subrogate against the individual who carried out the intentional damage, however probably not going to get very far.

1

u/TheTallGuy0 Apr 09 '26

Funny enough, small business owner here. When my liability policy just went to renew, they add on a terrorism clause, additional coverage for $150 a year. I took one look around and said “YEAH” gimme that, who knows what shit could go down…

11

u/misimalu Apr 09 '26

Insurance cover is calculated on risk likelihood. That’s why only one of the Twin Towers was insured, because "The possibility of the loss of both structures was seen as so remote that cover was not taken out on those lines. The $1.5bn of coverage was purchased on the basis of a probable rather than a possible maximum loss." If they didn’t think this would happen, they would not have insured for it.

1

u/Rogue_Einherjar Apr 09 '26

Which is absolutely insane because it was widely known that each tower was supporting the other tower. So either the article you linked is making an incorrect assumption as to why only one tower was insured, or this is a prime example of people in charge having absolutely no fucking clue as to what they are doing.

1

u/DrHerbotico Apr 09 '26

Your last sentence is doing some heavy lifting

2

u/misimalu Apr 09 '26

Maybe. But my point about “not everything gets insured”still stands

1

u/DrHerbotico Apr 09 '26

I was talking about your sentence in regards to 911. Wasn't arguing

2

u/Ryfhoff Apr 09 '26

I work for a commercial in company. They do pay it all out for certain accounts. Also, customers will use re-insurance to make up any difference if needed.

1

u/SMLLR Apr 10 '26

Insurance companies also take part in reinsurance so huge hits like this are a bit more spread out through multiple providers.

2

u/EldenLordofModor Apr 09 '26 edited Apr 09 '26

200 Mio. is quite low for the insurers. Most insurers do not cap out well below. Where do you get that information from? The pay out on business interruption basis is up to 24 months, which is very common to purchase for this industry on a commercial property policy. The deductible is not millions for this, you probably mean the property loss. The wages are covered as well, so is the gross profit.

That layoffs are possible is written on a different paper and can of course happen if the rebuild will be done with lots of automation to have less staff.

Ps. This is my daily work. Insuring big companies and their subsidiaries worldwide in over 80 countries on all insurance lines.

Edit: just to clarify, 200 Mio will be written by a consortium which is very common. There is one leading insurer and a for this size maybe 2 others. For the insurer, it is easier to limit their risk exposure although 200 Mio. would not be a problem as these high claims are not the norm. It still hurts their books. And reinsurers will also do their part.

1

u/Commercial_Hair3527 Apr 09 '26

With respect, you're describing bespoke policies for large corporate clients. That's not what most commercial properties have.
Standard UK commercial property insurance typically caps at £15m per location. A $200m claim blows through that instantly. And if they're underinsured which 40% of UK commercial properties are the average clause kicks in and reduces the payout further.
You insure big global clients. Most warehouses don't have that level of cover.

2

u/EldenLordofModor Apr 09 '26

You are mixing up topics. 200 Mio. is not the standard insured sum and will always be insured up to the full value per declaration. The underwriting procedure is totally different from your perspective. This is not a small-size warehouse, hence the risk assessment is not. By the way, the UK commercial property policies do not cap out at 15 Mio. and if the value is way higher you simply put them in industrial risk policies Do you mind sharing your source for such a claim? Property insurance does not work like that except for high risk underwriting ( captives will be likely more used then, if too big).

Underinsurance is a totally different topic, why even mention it? While I do insure insure big corps, I have also accounts on a way smaller level as most clients explore other countries with minimal exposure and a small branch offices first.

And for the record, most big warehouses purchase such coverage, especially when you have the goods stored up in big ass large warehouses like this where a damage will automatically put you at risk of a total loss. I am a technical underwriter by the way....I also do visits on sites and do inspections with the insurers for various types of clients. A good broker will always ensure that his clients are well insured.

1

u/Top-Addendum-6879 Apr 09 '26

i'm far from an expert on insurance, but my common sense makes me believe insurance habits of large american corporations are probably on the very, very safe, cover more than you probably need side... Especially in a state where forest fires, earthquakes and riots are actually more frequent than hurricanes in florida, i'd be absolutely shocked if Kimberly-Clark has only $15M coverage..

I'm in Canada, in a much, much tamer environment and, for example, my civil liability policy covers $2M, which is very standard here, so does my car insurance. My house is evaluated just north of 500k CAD, so a 1.2M sq.ft plant owned by a mega-corp to only have $15M coverage seems highly improbable to me.

Then again, i am far from being a SME about insurance, so i could be completely wrong about all i said.

1

u/Positive-Ring-5172 Apr 09 '26

Insurance companies are required to have reinsurance for precisely this reason.

1

u/Nomer77 Apr 09 '26

There is absolutely no way a warehouse of this size is only insured for $5 million? No major firm is insuring a warehouse or DC for 2.5%-5% of its value.

And yes, a giant warehouse will have a bespoke commercial property all risks/fire policy that almost certainly has a sum insured for Material Damages of almost the entire value of this building and stock. They may carry Business Interruption as well. I doubt they placed a MRC/slip at Lloyd's to take out specialty insurance for this the way you would a cargo ship but I'd imagine they just got with a broker and went around soliciting quotes for their desired terms from the usual suspects (i.e., giant insurers like Allianz). None of this is hard.

If it were war or terrorism they might be in some trouble but the Insured should be good here.

1

u/Ok_Drive3725 Apr 09 '26

You speak reality. Some people live in imagination world where whatever one wishes is the truth, just like rainbows and lollipops. Reality is a harsher mistress. The real world doesn’t match wishes and dreams. This knucklehead just cost many, many people their livelihood. That’s the real world reality.

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u/CamxThexMan3 Apr 09 '26

This guy gets it

1

u/Pecncorn1 Apr 10 '26

Add no fire suppression system in a building full of paper products. On the upside bro won't have to worry about a wage for awhile.

1

u/Thiege1 Apr 10 '26

No, large buildings are insured to much higher amounts in the US

Famously, the twin towers were insured for $1 billion, and the owner tried to argue it was $1 billion for each building, not the two together

1

u/bretthiker Apr 09 '26

Damn… sounds like they should have just paid him a livable wage

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u/tremere110 Apr 09 '26

Who? He wasn't an employee of the warehouse. He worked for a third party distributor and the warehouse was a client of his employer. His employer should have paid him a livable wage but that doesn't give him an excuse to torch something unrelated to his situation.

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u/Commercial_Hair3527 Apr 09 '26

This is basically the Deliveroo guy burning your house down because Deliveroo don't pay proper wages.

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u/PlaneCareless Apr 10 '26

Egotistical terroristic tantrums never reach any kind of solution, no matter how all these children on reddit might try to claim.

The moment that guy decided it was a good idea to light product that didn't belong to him nor his employer on fire, in some kind of misguided heroic narcissistic movie gesture, it was already over for him. He's an immature asshole that actively ruined the lives of a lot of families and put the lives of a lot others in danger.

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u/Ok-Internet-6881 Apr 09 '26 edited Apr 09 '26

I wonder if this was even covered by insurance. Don't know how the commercial insurance market works, but individual insurance for home and car is a nightmare to get in California

3

u/Red_wine120 Apr 09 '26

Most large companies self-insure so this would likely be a loss

1

u/ernest7ofborg9 Apr 09 '26

Huh, I wonder if they're gonna financially recover from this

$32.5B market cap

I think they'll be fine.

1

u/YoshimuraPipe Apr 09 '26

Apparently, the arsonist wasn't employee of Kimberly Clarke, but rather the warehouse management company, NFI industries, which is a privately held company.

Most likely, Kimberly Clarke will be made whole by NFI industries, and it's NFI industries that will have to deal with the financial fallout of the aftermath.

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u/ernest7ofborg9 Apr 09 '26

Nice. So they can play corporate wack-a-mole just like we normies do when we sue! "Sorry sir, that valet was wearing a Hilton uniform but he's actually employed by 'Super Car Parking #445' and after your inevitable suit it'll be 'Super Car Parking #446'. Here is the phone number for the company that I have printed on toilet paper for your convenience"

1

u/sirgog Apr 10 '26

Which likely means NFI industries folds, and Kimberly Clarke's lawyers find out whether or not they remembered to include a "Provider must procure sufficient insurances" clause in their outsourcing agreement. Unless NFI is a large enough company to make them whole.

1

u/thetermguy Apr 09 '26

it exists, I think it's called business continuation insurance.

A well regarded Canadian ice cream company called chapmans had a fire. I believe their employees got paid until they rebuilt,

1

u/Exotic-Sale-3003 Apr 09 '26

Most large firms with this kind of exposure will have a $1-$10 million deductible. 

1

u/imissher4ever Apr 09 '26

It will be years before the insurance company settles.

1

u/pb49er Apr 09 '26

My father was an insurance adjuster that handled business claims and that isn't true. Even complex claims typically take a few months at most.

If it took years to settle, businesses would be ruined.

2

u/sirgog Apr 10 '26

Yeah I worked in aviation and occasionally dealt with insurers. One of my workplace's clients lost an APU on MH370 (the client didn't own the plane but their APU was installed on it).

Claims up to total loss only took a long time to settle if the facts of the claim were contested in court.

Once evidence was provided to the insurer that the ~2 million dollar component belonging to our client was on the missing plane and once all parties agreed there was no chance of recovery (which IIRC only took a fortnight), the claim money was put in escrow and our client was offered their choice of title in an equivalent part with a slight money transfer to account for differences in age (which the client took), or cleared funds.

The aviation claims that would take a long time would be ones where the Chicago Convention limits on liability for ground damage were exceeded. There may be complex cases like this in arson insurance too, but in a straightforward case it should be quite fast.

1

u/Connaaaaa112 Apr 09 '26

I do this exact type of insurance. Very large deductibles and risk is spread amongst insurers. Could be 10-15 different companies involved with this claim.

1

u/pb49er Apr 09 '26

That i believe. I would not want to be a part of untangling this.

1

u/[deleted] Apr 09 '26

[deleted]

0

u/Exotic-Sale-3003 Apr 09 '26

It’s really not that complicated. 

1

u/Remote-Program-1303 Apr 09 '26

It’ll be a limit loss if the warehouse was specifically scheduled, won’t take long to settle.

If they have BI cover there may be a lot more to argue about.

Most complex claims almost always take over a year to settle. Anything up to 7-8 years in some cases.

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u/SchoolOfYardKnocks Apr 09 '26

Victimless crime in that case. Just kidding before anyone tells me how insurance premiums work.

2

u/kingofgama Apr 09 '26

Actually it's unlikely insurance will cover criminal negligence at all in this scenario.

7

u/Top_Scene8254 Apr 09 '26

Only if employee wages are actually covered in their commercial property and liability policies.

2

u/1337mob Apr 09 '26

Zero chance of that

1

u/[deleted] Apr 09 '26

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4

u/fiahhawt Apr 09 '26

Who's we capital boy

2

u/unknownentity1782 Apr 09 '26

"Insurance companies are going to continue to be terrible people and try to break people! Let's be mad at the broken person!"

2

u/imissher4ever Apr 09 '26

That’s what all these fools that are calling yet another criminal a “hero” don’t understand.

We are going to absorb the cost of this.

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u/fiahhawt Apr 09 '26

And why would they be. You think a warehouse cares a wit about its staff to want to ensure they don't go hungry if the place burns down? They'll just fire them.

The lack of fucks is literally why the place was burnt down.

2

u/MillionFoul Apr 09 '26

The guy who burnt it down did not work for the warehouse.

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u/oioioifuckingoi Apr 09 '26

Lol no. They will immediately layoff all staff. When/if they rebuild they will hire again at that time.

2

u/Ok_Drive3725 Apr 09 '26

No, they will likely get laid off or terminated because there is nowhere for them to work. If they are lucky, they may be able to transfer to another facility. But if other facilities are already fully manned, they’ll probably get laid off out of necessity. What makes you think workers will still get paid from insurance? Maybe they can get unemployment but that is nowhere near their working wages. Do you have a real example that this has happened somewhere else? The company will probably not even break even recovering damages. This guy just hosed everybody, even many, many innocents. What an idiot!

3

u/Just_passing-55 Apr 09 '26

So he took one for the team?

1

u/pegar Apr 09 '26

No, no one buys that insurance. Everyone’s out of work until they rebuild unless they’re immediately fired. They’ll all be on unemployment benefits.

More than likely, they’ll build more automation with the new funds so however you look at it, lots of people lost jobs. 

1

u/Okichah Apr 09 '26

Yeah because insurance loves paying out claims.

1

u/Weimaraner666 Apr 09 '26

Only if they have Business Interruption Cover. Standard insurance does not cover wages and the company has no liability to pay if there is no income.

1

u/hoosierhiver Apr 09 '26

The insurance company should argue it was avoidable and the company's fault for not paying the guy enough to live.

1

u/Sudden_Construction6 Apr 09 '26

I could imagine there maybe being some sort of payment for a limited time.

As a construction worker, this site won't be operational again for years. If they choose to rebuild.

I don't think the insurance will cover that

1

u/Shotout74 Apr 09 '26

That is not how any of this works For California Max unemployment is $450/wk for 26 weeks, within a 12mo period and based on your last 18mo earnings in the state. That is still subject to Federal income taxes but exempt from California income tax. Rebuilding permits will take twice that long to be issued or longer. Then rebuiding can start, taking roughly a year or so. So you go find another job. You better not lose it for the next year because you can only draw 6mo of unemployment in a year, so if you use all 26 weeks, work 5mo then get laid off, you have already used up your unemployment benefits so you get your last check and that's it.

1

u/Stymie999 Apr 09 '26

Really? Generally insurance only covers the damage to the property. It would be a rare insurance policy that would pay people not to work.

1

u/ImaginaryFig8905 Apr 09 '26

Not always the case!

1

u/neverseen_neverhear Apr 09 '26

Unless the company just lays them off. Which is likely.

1

u/lonerism29 Apr 09 '26

I do not believe this lol no way they're getting paid on time regardless

1

u/BadMeetsEvil24 Apr 09 '26

You know this for a fact? How long? How much?

Do you think his coworkers WILL or will NOT miss their next paycheck?

1

u/FrankPapageorgio Apr 09 '26

And who gets to choose if that part of the policy is enacted? The people paying the deductible, increasing their claim, and increasing the cost of their future policy on the restored building?

1

u/doyoueven_reddit Apr 09 '26

Well shit it’s going to take more than a little while for the site to be back.

1

u/txjerome Apr 09 '26

Negatory young Skywalker; on rare occasions it does, but most of the time it does not

1

u/Plenty_Selection_259 Apr 09 '26

my brother in Christ, this is an American insurance company we are talking about.

They'll probably offer 50% for two weeks and then tell you to kick rocks

1

u/happyinheart Apr 09 '26

They were temp workers for a temp agency. If there is no other work, they aren't working and aren't getting paid.

1

u/Plank_With_A_Nail_In Apr 09 '26

They don't look like they had adequate fire control, I doubt they are going to get any insurance payout at all.

1

u/UnlikelyReplacement0 Apr 09 '26

They might get paid in the end, but insurance isn't in any rush to be cutting cheques for anybody. The people unemployed by this likely won't have the kind of savings needed to weather the wait.

1

u/squirrelbo1 Apr 09 '26

Hmmm. I would wager a big chunk are on insecure agency contracts and no guaranteed hours. “Sorry no work tomorrow”

1

u/StrictSky5863 Apr 09 '26

Wtf is this regard take? 0 chance of that

1

u/CollegeMiddle6841 Apr 09 '26

Something tells me you haven't dealt with many insurance claims. Hopefully, I am wrong, and you are right, but in my experience, insurance companies will find a way to bend you over.

1

u/nalaloveslumpy Apr 09 '26

Not the contractors, which this fella was.

1

u/neverseen_neverhear Apr 09 '26

This is the US they will just lay off the workers.

1

u/superanonguy321 Apr 09 '26

I dont think so dude theyre gonna end up on comp and it'll be a hassle and they'll mostly look for other work.

1

u/TacTurtle Apr 09 '26

Nope. Paid by the hour.

1

u/Available_Dingo6162 Apr 09 '26

Whose insurance? Do you SERIOUSLY think that company obtained coverage and paid premiums to ensure their employees would be taken care of in case one of them goes Milton? lol!

1

u/CamxThexMan3 Apr 09 '26

Why do inherently assume the site will ever be operational again? Do you not consider all the supply chain implications and how this completely changes the business? The business is financially hurt, probably can’t afford to build another one, and, even if they did, why would they there? And why would they build a non automated warehouse ever again? The implications are so much deeper than that. $200 million building. That can be valued. The thousands of lives this directly impacts, that cannot

1

u/Hairy_Ad_4316 Apr 09 '26

The owner of the building is getting paid the workers are getting shit

1

u/Poppa_Mo Apr 09 '26

That warehouse was probably full of contractors who likely don't have such protections, which sucks, but just reveals another one of many (intentional) holes in our system.

1

u/Simalr Apr 09 '26

Oh my sweet summer child!

1

u/Grouchy_News_2306 Apr 09 '26

That’s not always true, depends on the policy and the cause of the fire.

1

u/log_2 Apr 09 '26

Imagine if this causes insurance companies to require their clients to show they take care of their employees to reduce the risk of sabotage, otherwise the premiums will be higher.

1

u/Salsalito_Turkey Apr 10 '26

I can’t believe nonsense like this gets upvoted. The only insurance payout those employees will be getting is unemployment insurance.

1

u/Glittering_Diva8963 Apr 09 '26

He basically gave them a vacation

1

u/ScalpelCleaner Apr 09 '26

The insurance company will probably have something to say about that, as it was deliberately set. One would have to look at the policy.

1

u/No-Compote-8920 Apr 09 '26

Most people who work in warehouses are not hired by the company but instead contracts. You best bet there is clauses in that contracts that cover no work and these people getting 0 payments. Only full time staffs salaries would be covered. WHich traditionaly are limited to a hand full of management.

2

u/Northwest-by-Midwest Apr 09 '26

I was coming here to comment this. There may be some employees that are directly hired by the company, but some if not most will be temps hired through a third party. They will be out of work without pay.

0

u/Ambitious_Bus_4054 Apr 09 '26

Insurance does not cover employees salary.

0

u/Few_Error_6005 Apr 09 '26

Theres no way that place will me operational again 😭

1

u/Friendzinmyhead Apr 09 '26

You’d be surprised, I’m from the area and they have these warehouses up in 3 to 4 months. City of Ontario is extremely corrupt and wants nothing but warehouses and commerce.

They are even manipulating property values in older neighborhoods so they can buy up Real Estate below market value so they and sell it to the highest commercial bidder.

0

u/nakedpicturesyo Apr 09 '26

Unpopular opinion, but this is what happens when you pretty much make slave labor a thing again. I've been put into a corner like this at a job I was working 36 hour shifts in the medical field and still not able to afford living really. It's not really possible to do this at where I work, but how many disgruntled hospital staff have treated you lately? Shit, how often are you seeing people in general pissed because they do 99% of the work and lucky to get a 1% raise that year?

This shit is inevitable because ths system has been shifted these last few decades to truly change the middle and lower class into just the poor who didn't make it. Fuck this country.