COMMISSION
AGENDA MEMORANDUM

Item No.

ACTION ITEM

Date of Meeting

DATE :

September 12, 2025

TO:

Stephen P. Metruck, Executive Director

FROM:

Elizabeth Black, Deputy General Counsel

8e
October 14, 2025

SUBJECT: Settlement with Great American Insurance Company
Amount of this request:

$ 10,200,000 paid by Port
$ 10,188,969 paid to Port
Net $ 11,301

ACTION REQUESTED
Authorization for the Executive Director to execute an amendment to the August 2020
Settlement Agreement and Release between the Port and its primary insurer, Great American
Insurance Company (GAIC).
EXECUTIVE SUMMARY
The Port has an opportunity to finalize the last remaining details of its 2020 settlement
agreement with the Port's primary insurance carrier regarding the insurer's scope of coverage
for historic environmental contamination. With this amendment to the prior settlement, the Port
will make a payment to GAIC in the amount of $10,200,000, reflecting the Port's obligation to
reimburse costs GAIC spent on the Port's behalf, and GAIC will make a payment to the Port in the
amount of $10,188,969, reflecting GAIC's remaining obligation to the Port under the parties'
2020 settlement agreement.
DETAILS AND JUSTIFICATION
From 1963-1985, the Port had primary insurance coverage through predecessors to Great
American Insurance Company (GAIC). Under those policies and subject to a reservation of its
rights to deny coverage, GAIC provided defense and indemnity coverage to the Port for certain
environmental investigation and cleanup costs associated with the Lower Duwamish Waterway,
Harbor Island/East Waterway, and Terminal 91 (the "Contaminated Sites") and has paid over $80
million to the Port to date. The Port and GAIC share a mutual interest in resolving their dispute
regarding the scope of GAIC's coverage obligation without litigation. The parties reached a
settlement agreement in 2020 that resolved all issues except the two addressed in the proposed

Template revised January 10, 2019.

COMMISSION AGENDA - Action Item No. 8e
Meeting Date: October 14, 2025

Page 2 of 2

amendment; the amendment would resolve the remaining disputes regarding GAIC's obligations
to the Port for the Contaminated Sites.
The amendment includes the following key terms: GAIC will make immediate payment to the
Port in the amount of $10,188,969, reflecting GAIC's remaining obligation to the Port under the
parties' 2020 settlement agreement for cleanup costs at Terminal 91. In addition, 30 days after
receipt of GAIC's T-91 payment, the Port will pay $10,200,000, to GAIC as reimbursement for
costs that GAIC paid on the Port's behalf to successfully recover contribution from other
responsible parties. The amendment will resolve all claims with respect to the Contaminated
Sites, and both parties will reserve all of their rights regarding other potential claims.
ALTERNATIVES AND IMPLICATIONS CONSIDERED
Alternatives and implications have been considered and discussed in attorney-client privileged
communications. Counsel for the Port recommends that the proposed settlement be approved.
FINANCIAL IMPLICATIONS
The amounts the Port and GAIC will transmit to each other are similar. Separate payments are
necessary for recordkeeping purposes and for documenting the Port's exhaustion of certain
insurance policies. The Port will pay slightly more than GAIC, a net amount of $11,301.
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS
August 11, 2020 - Commission approved a settlement agreement with GAIC.
April 23, 2019 - The Commission authorized a settlement agreement with Lamorak Insurance
Company and Bedivere Insurance Company, both formerly known as OneBeacon Insurance
Company.
May 22, 2018 - The Commission authorized a proposed settlement agreement with Great
American Insurance Company to resolve remaining claims relating to defense costs for
environmental investigation and cleanup incurred through December 31, 2014.
October 27, 2015 - The Commission authorized the proposed 2015 Addendum Agreement to the
2014 Duty to Defend Settlement Agreement and Partial Release between the Port of Seattle
and GAIC.
August 19, 2014 - The Commission authorized the proposed 2014 Duty to Defend Settlement
Agreement and Partial Release between the Port of Seattle and Great American Insurance
Company and Great American Insurance Company of New York.

Template revised June 27, 2019 (Diversity in Contracting).