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INSURING MARITIME OPERATIONS, INFRASTRUCTURES AND INTERNATIONAL TRADE Let me start by thanking the organizers of NIMPORT for the success recorded so far in organizing this yearly conference and for the opportunity provided to make a presentation at this conference.
INSURING MARITIME OPERATIONS, INFRASTRUCTURES AND INTERNATIONAL TRADE
Let me start by thanking the organizers of NIMPORT for the success recorded so far in organizing this yearly conference and for the opportunity provided to make a presentation at this conference.
As we may all be aware, insurance is a very important aspect of risk management and with the knowledge that the discussion on maritime operations in any country cannot be complete without reference to marine insurance (through which modern insurance actually started) and its relevance to trade and commerce in general and international trade in particular. There is no doubt therefore, that this forum is best suited to discuss the subject: Insuring Maritime Operations, Infrastructures and International Trade.
Investment in the Nigeria maritime sector accounts for about 90 per cent of the global transportation requirement for the nation.
MARITIME INDUSTRY STRUCTURESector structure composed mainly: - port industry- shipping and ancillary services, - offshore services, - ship building and ship repair, - marine services, - bunkering services, etc.The port industry is relatively the most developed area in the sector. Nigeria accounts for over 65% of total seaborne traffic in volume and value in West and Central African sub-region.
The Major Players….
Insurance necessary for the following:
emanating from this all important industry that significantly impacts the economic life of the nation cannot be over emphasized, hence the relevance of this topic at this auspicious time.
Defined as ….
“the act, system, or business of insuring property, life, etc., against loss or harm arising in specified contingencies, as fire, accident, death, disablement, or the like, in consideration of a payment proportionate to the risk involved”.
“a contract that provides coverage in which one party agrees to indemnify or reimburse another for loss that occurs under the terms of the contract”.
Insurance contract is set forth in a written or printed agreement or policy. The consideration/amount for which anything is insured is an insurance premium.
Terminal operators may have to take out insurance policies, either under the terms of operating agreements entered into between them and port authorities; as a result of the terms of terminal tariffs previously drafted by such authorities; according to the liability and indemnity clauses inserted in contracts agreed upon with particular users; or simply because the terminal operator not able to bear the consequences of the materialization of one risk, decides to transfer it to a specialized company (i.e. insurance company).
Ship Repairers Liability
Insurance that protects a ship repairer from liabilities whilst the vessel is under their care, custody and control.
In an accident where pollution, damages or injury occur, the Designated Person can be held personally responsible. This insurance covers a DP’s liability from professional negligence, the “contingent liability” of a claim that would normally be covered by their employer’s P&I policy and legal expenses to defend a claim.
Marine Pilots Liability
This insurance provides cover against claims made against marine pilots. Cover extensions are available for third party liability and personal accident.
Ship Brokers, Ship Agents and Ship Managers Liability
Cover to protect transport intermediaries against claims for negligence and error or omission.
“INDEMNITY”P&I insurance is an indemnity type of insurance, which means the ship-owner (or member of the club) must demonstrate his loss before the club will pay out (or indemnify him) under the terms of the insurance policy. It is important to bear in mind that the club never assumes the owner’s liability, therefore technically the owner (ormember) is always responsible for payments (the “pay to be paid” principle). In practice, the club takes over the business of handling claims and ensuring that payments are correctly made.
COVERAGE INCLUDE:- Collision with Fixed or Floating Objects (FFO)The P&I cover may include liability for collisions (“RDC”), for example when the member’s ship is in collision with another ship, or when the entered ship strikes a fixed object, i.e. a quay, dock or buoy.- Death and Personal Injury on Board The VesselP&I insurance covers an owner’s liability for all deaths,personal injuries and illnesses which occur on board, includingdeath or injury to crew, passengers, stevedores, pilotsand visitors to the ship.Repatriation of Sick or Injured Crew and Hospital ExpensesP&I insurance also covers a shipowner’s liability to pay for the costs of repatriating crew members who become sick or are injured on board. The insurance also covers the crew’s hospital bills and costs of sending replacement personnel to the ship if necessary.
Loss of Crew Members’ Personal EffectsP&I insurance also covers the owner’s liability for loss of crewbelongings in cases of shipwreck or fire on board. The cover onlyapplies to items which are deemed to be reasonable for any crew member to have with him on board. Loss of or Damage to CargoOne of the major functions of Protection and Indemnity insurance is to cover a shipowner, or the charterer of a ship, for liability for loss of, or damage to, cargo if there has been a breach of the contract of carriage. This breach of contract usually means that something has happened to the cargo while it was on board the ship or being loaded or discharged, and for which the owner or charterer can be held responsible.
Other P&i Covered RisksOther risks covered include liability for stowaways, liability for oil pollution and other types of pollution and legal liability for wreck removal if the ship sinks and is blocking free navigation for other vessels. In short, P&I insurance is a very comprehensive type of insurance cover which makes it easier for a shipowner or charterer to trade in international shipping transportation. P&I is as important to a prudent shipowner as his Hull and Machinery insurance cover. SUMMARYP&I is a special type of marine insurance. It is a liability insurance that a prudent shipowner, manager or charterer needs, particularly if the ship is employed in by the multinational companies such as oil companies or for international trade. P&I insurance covers a shipowner or charterer for liabilities and losses in direct connection with the operation of the ship.
IGI is aware of the difficulties ship owners go through before they get admitted into P&I Clubs which are mainly administered from Europe and America. The company is also not unaware of the heavy contribution required on year to year basis in maintaining membership of P&I clubs.
IGI has therefore established a simplified relationship with a P and I Association called the East of England Protection and Indemnity Association, which has given her the capacity to admit members and take appropriate decisions.
We are now able to admit both the vessels operating in brown water and blue water into the Club up to a limit of liability of $100m any one vessel. For this purpose, we also confirm that the capacity of the Association is also fully backed by underwriters from the Lloyds of London. We are open to assist you in this regard and with regard to conventional insurance policies at any time, starting from this conference.