Travelers wants nearly $21 million back after a propane tank allegedly exploded at a Milwaukee recycling center, and it's pursuing the operator's insurers too.
Travelers Insurance Company and the City of Milwaukee sued on July 30, 2026, in federal court in Wisconsin over a fire at a recycling center on May 31, 2023. According to the complaint, a propane tank was improperly sorted and exploded in a paper conveyor, starting the fire.
The city owned the property. The complaint says Republic Services operated the recycling center, having acquired the site's operator, Resource Recovery Systems, in 2017 and later agreeing, in a 2019 amendment, to keep the original operating agreement in place.
The complaint's operational allegations center on staffing and safety systems. The filing alleges Republic ran the center without the proper level of staff on the day of the fire and in the days before it. It alleges Republic was aware of issues with the fire suppression system and, because that system was compromised, turned off the alarm within the recycling center. The complaint says Republic continued to operate and ran the conveyors at "unreasonable speeds."
The operating agreement came with safety requirements. The complaint points to Republic's Operations and Maintenance Manual, which it says required a daily safety checklist and told staff to make "every effort to minimize the possibility of explosion." The manual, the filing says, required that the payloader operator and all sorters be trained to identify pressurized material, and that any pressurized item trigger a shutdown and removal. Propane cylinders, according to the complaint, were among the hazardous materials the manual said the facility was not to accept.
On the money, Travelers says that, under its policy with the city, it determined it was reasonable and necessary to pay $20,991,821.44 for the damage, and that the city was required to pay deductibles of $490,240.00. Travelers says it is still making payments on the loss. As subrogee - stepping into the city's shoes to recover what it paid - Travelers brings negligence and breach-of-contract claims against Republic.
The insurers are in the case directly. The complaint names Ace American Insurance Company and Ace Property and Casualty Insurance Company as Republic's liability insurers and alleges each is directly liable to the plaintiffs under Wis. Stat. § 632.24, Wisconsin's direct-action statute.
The plaintiffs ask the court for judgment in an amount to be determined, plus prejudgment interest, costs and fees.
The allegations have not been tested in court, and no judge has ruled on the claims.
