Garden Grove Chemical Tank Crisis: Residents Face Denied Insurance Claims

Residents evacuated during the May 22 chemical tank crisis at GKN Aerospace in Garden Grove, Calif., are struggling to recover out-of-pocket costs. While an Orange County United Way fund stopped accepting applications after 6,000 requests, some policyholders report insurance denials despite official evacuation orders.

Why were evacuations ordered in Garden Grove?

Authorities ordered the evacuations on May 22 after firefighters warned that a tank containing toxic chemicals at GKN Aerospace could spill or explode. Officials stated the situation put lives at risk, affecting approximately 50,000 residents.

Evacuees faced immediate logistical challenges. Jeff Goddard of Cypress reported that finding lodging on short notice during a holiday weekend was difficult for his family, which included a wife, three children, and animals.

Why are insurance claims being denied?

Some residents are finding that “loss-of-use” clauses in their policies do not cover evacuations based on potential threats. Jeff Goddard, who spent nearly $2,000 on food and a four-night hotel stay in Manhattan Beach, had his claim denied within a day of filing.

According to a denial letter sent to Goddard, the possibility of an explosion did not meet the policy’s coverage requirements. Goddard noted that while explosions are listed as covered perils, the company indicated coverage would have applied only if the tanks had actually exploded.