Cargo left behind due to late declaration won’t be covered
From an insurance
perspective, once the
new Solas regulations
kick in, existing cargo
policy exclusions may
possibly be widened
to extend to inaccurate
weighing of containers, says
Hugh Reimers managing
director
of Eikos/JLT.
“However in discussion
with one insurer, Marine
Underwriting Managers,
they confirmed that they
would not be widening
their exclusions. What’s
important to note, however,
is that costs associated
with delay caused by failure
to declare ‘sufficiently in
advance’ for the preparation
of the stowage plan, leading
to cargo being left behind,
will not be covered under a
cargo policy,” he said.
“In addition, penalties
imposed on shippers for
non-compliance are not
recoverable under marine
insurance. However
NVOCC ‘shippers’ under
ocean bills may be able to
take advantage of their
‘Fines & Duty’ or ‘Errors
& Omissions’ cover in this
instance.”
A further important
insurance qualification to
bear in mind, according
to Reimers, is that both
marine cargo and marine
liability insurance policies
will respond, provided
actions or omissions giving
rise to non-compliance are
not considered intentional
or reckless and as long as
the insured did not know
and ought not to have
known that there had been
a contravention of the law.
“In the past overweight
cargo compromised lashing
arrangements, stowage
limitations and vessel
stability. The changes
to Solas were primarily
introduced to improve ship
stowage and container
safety following highprofile
incidents such as the
grounding of the ship MSC
Napoli off the south coast
of England in 2007, where
the insurance bill was in the
region of £120 million.
“The biggest loss in
2013, the MOL Comfort,
sank after literally
breaking in half. This
has been associated with
misdeclared container
weights. The amended Solas
regulation has therefore
been welcomed by both
the marine and marine
liability markets, due to the
expected reduction in the
incidence of claims.”
INSERT
£120m
Insurance bill for the MSC Napoli
which was grounded in 2007.
INSERT & CAPTION
Penalties imposed
on shippers for
non-compliance are
not recoverable under
marine insurance.
Hugh Reimers
