Insurance Premiums in the GOA


#1

[LEFT]My name is Amiad Daniel and I am a studying the economic impacts of Piracy.

I would like to consult with you regarding two questions: <o></o>[/LEFT]
[LEFT]Does the type of the ship (tanker, container etc.) affect the war risk insurance premium for ships travelling through the Gulf of Aden?
[/LEFT]


#2

1st question:
depends on respective P&I club, and their list of current war zones, so the answer is yes, conditionally.
In case that war zone clause applies (or special risk zone) the freight is additionally compensated.

2nd question?


#3

[B]Thanks for the info. Actually, I am quite interested in a more specific info-
Is there a difference in the War Risk insurance and/or K&R premiums for THE DIFFERENT TYPES OF SHIPS? (meaning- will a tanker pay more than a Ro-Ro?)
Any ideas?

Ami [/B]


#4

The answer is YES.
It all works on the basis of estimated risk involved on respective vessel.

If you take for example a tanker with maximum speed 14 knots, and low freeboard - this will be clasified as high risk factor / vessel - and higher premium.

On the other hand take a container vessel with speed of 25 knots, and high freeboard and this will be clasified as low risk vsl, with lower premium.

FYG - speed of succesfully attacked and hijacked vessels was up to 14 knots (99% of the cases).
The fire was opened on the vessels with speed between 14 to 15 knots (99% of the cases).
Most of the hijacked vessels had lower freboard.

Those are some of the risk factors to be considered, just to give you a better picture.


#5

Great answer! Thanks.
Can you refer me to somewhere where I can find more detail on the issue?
HOW MUCH more do slower ships pay? How much less do faster ships pay?
Is it only K&R or War Risk?
I’d be more than grateful for any detailed referances.

Thanks again.
Ami


#6

[quote=Ami;20058]Great answer! Thanks.
Can you refer me to somewhere where I can find more detail on the issue?
HOW MUCH more do slower ships pay? How much less do faster ships pay?
Is it only K&R or War Risk?
I’d be more than grateful for any detailed referances.

Thanks again.
Ami[/quote]

Hmmm,
I gave you the best answer I could as a shipmaster.
The way I see it, piracy will not be covered by war risk.
War risk coverage is for war zones as defined by respective club, with each current war zone listed i.e P&I will define their war zones in the World on the principle of the estimated risk they see.

Piracy risk - is different, and at the moment GOA is defined as “special risk area”, not the war zone.
This will be applied only for vessels transiting GOA.

The practical difference in risk in each zone is:
In the war zone there is a chance of sinking and total loss of vessel, cargo and life due to military operations.

In the special risk area - GOA, there is no such risk, but instead there is a chanse of hijacking followed by ransom demand and possible claims against the owners by crew members for fear, or any kind of personal suffering they maight have experienced while serving on board. (see maersk alabama case on forum)

Suggest to contact P&I club for more details on coverage and premiums.

There are:

Sweedish P&I club,
North of England P&I club
UK P&I club.
etc

Just type them in google, you will get the contacts and try to ask them.

Regarding the seamen wages and additional payments when transiting the area - this depends on collective agreement (NOT P&I club), nationality of vessel (if flag state will declare special zone), the owner (and his generosity), national union or pool of seafarers, etc…

For FOC, there are additional number of organisations to negotiate additional wages: such as IBF (international bargaining forum), or chamber of shipping, or ITF…, but anyhow this will be finally noted on collective agreement, which is usually renewed anually.

Hope this helps, I gave the best shot.