Removal of Golden Ray wreck has value “several hundreds of millions of dollars,” says insurer Allianz. [St. Simons Sound Incident Response Photo]
There’s excellent news and dangerous information within the newest annual Safety & Shipping Review from insurer Allianz Global Corporate & Specialty SE (AGCS). The excellent news is that worldwide transport business continued its long-term constructive security development over the previous yr, with the variety of giant vessels misplaced remaining at document low ranges in 2020, with reported incidents declining year-on-year.
The not-so-good information? Despite the low degree of losses, “it is not all smooth sailing,” says Capt. Rahul Khanna, Global Head of Marine Risk Consulting at AGCS. “The ongoing crew crisis, the increasing number of issues posed by larger vessels, growing concerns around supply chain delays and disruptions, as well as complying with environmental targets, bring significant risk management challenges for ship owners and their crews.”
LOSSES AND CASUALTIES
The annual AGCS examine analyzes reported transport losses and casualties (incidents) over 100 gross tons. During 2020, 49 whole losses of vessels have been reported globally, just like a yr earlier (48) and the second lowest whole this century. This represents a 50% decline over 10 years (98 in 2011). The variety of transport incidents declined from 2,818 to 2,703 in 2020 (by 4%). There have been greater than 870 transport losses over the previous decade.
The South China, Indochina, Indonesia and Philippines maritime area stays the worldwide loss hotspot, accounting for one in each three losses in 2020 (16) with incidents up year-on-year. Cargo ships (18) account for greater than a 3rd of vessels misplaced up to now yr and 40% of whole losses over the previous decade. Foundering (sunk/submerged) was the primary explanation for whole losses over the previous yr, accounting for one in two vessels.
- Machinery harm/failure was the highest explanation for transport incidents globally, accounting for 40%.
NO REDUCTION IN CLAIMS
Despite decrease the entire losses, the sector has not been spared vital claims exercise.
“Overall, the frequency of marine claims has not reduced. We are also seeing an increased cost of hull and machinery claims due to delays in the manufacture and delivery of spare parts, as well as a squeeze on available shipyard space,” says Justus Heinrich, Global Product Leader, Marine Hull, at AGCS. “Costs associated with salvage and repairs have also increased.”
In future, warns AGCS, insurers might probably see an uptick in equipment breakdown claims if COVID-19 has affected crews’ capability to hold out upkeep or observe producers’ protocols.
LARGER VESSELS, LARGER EXPOSURES
The blocking of the Suez Canal by the Ever Given containership in March 2021 is the newest in a rising listing of incidents involving giant vessels or mega-ships. Ships have change into ever-larger as transport corporations search economies of scale and gasoline effectivity.
“Larger vessels present unique risks. Responding to incidents is more complex and expensive. Approach channels to existing ports may have been dredged deeper and berths and wharfs extended to accommodate large vessels but the overall size of ports has remained the same. As a result, a ‘miss’ can turn into a ‘hit’ more often for the ultra-large container vessels,” says Capt. Nitin Chopra, Senior Marine Risk Consultant at AGCS.
“If the Ever Given had not been freed, salvage would have required the lengthy process of unloading some 18,000 containers, requiring specialist cranes. The wreck removal of the large car carrier, Golden Ray, which capsized in U.S. waters in 2019 with more than 4,000 vehicles on it has taken over a year and a half and cost “several hundreds of millions of dollars,” says AGCS.
FIRES, CONTAINER LOSSES
The variety of fires on board giant vessels has elevated considerably in recent times. There was a document 40 cargo-related fires alone in 2019. Across all vessel sorts, the variety of fires/explosions leading to whole losses elevated once more in 2020, hitting a four-year excessive of 10. Fires usually begin in containers, which may be the results of non-/mis-declaration of hazardous cargo, equivalent to chemical substances and batteries. When mis-declared, these is perhaps improperly packed and stowed on board, which may end up in ignition and/or complicate detection and firefighting. Major incidents have proven container fires can simply get uncontrolled and end result within the crew abandoning the vessel on security grounds, thus rising the scale of loss.
Loss of containers at sea additionally spiked final yr (over 3,000) and have continued at a excessive degree in 2021, disrupting provide chains and posing a possible air pollution and navigation threat. The quantity misplaced is the worst in seven years. Larger vessels, extra excessive climate, a surge in freight charges and mis-declared cargo weights (resulting in container stack collapse), in addition to the surge in demand for shopper items might all be contributing to this improve. There are rising questions on how containers are secured on board ships.
There’s far more within the full report. Download it HERE.
