Here's a solution to your solution: incorporate each oil well as a separate corporation wholly owned by an oil company, carrying no insurance, and remitting its entire profits each year to its shareholder as a dividend. The corporation can buy the property it wants to drill on, so that there's no property owner to demand insurance.

Then, if there's an accident like this one, all the other property owners can sue the oil well, which will go bankrupt and pay them pennies on the kilodollar.

In short, your "ultimate solution" is ultimately thwarted by the institution of the limited-liability corporation.

(An analogous bug exists even without limited-liability corporations, but it's less severe: "Tortfeasor regrets that he has only one life to give to atone for his torts.")