Autonomous Ship Tech: Opportunity & Risk

Maritime Activity Reports, Inc.

April 18, 2019

There have been numerous articles and opinion pieces speaking of the potential application areas of maritime autonomous technology, the elimination of “human error”, and the resulting safer operations that will supposedly be realized. The question of whether autonomous ships will offer safer solutions than crewed ships remains to be answered, and will not be resolved today. However, there is an important issue regarding levels of autonomy in vessel operations that needs to be addressed.

Many vessel operators feel that this technology will not impact their particular operating environment, and therefore there is no reason for them to worry about it.  But the reality is that all vessel operators should stay abreast of developments in the arena of autonomous vessel operations. There are several reasons for this, including trickle down impact as well as potential impacts on the regulatory landscape.

We all need to realize that many of the major players in the autonomous vessel debate have the potential for significant financial benefit when this technology is implemented. We also need to understand that it may not be just a business decision that is the deciding factor in initiating autonomous vessel operation. We cannot discount the potential power of legislative lobbying on the issue of increased automated onboard operations in the name of vessel safety. This is one reason why it is important to stay educated on the developments, and proactively adopt improved safety and navigation technology and procedures. As an industry we must drive this discussion and help to steer the innovation so that it will help us operate safety and more efficiently. Keeping the status quo is not a viable option, nor is just looking to be “grandfathered” in.

To the many naysayers who feel that increased automation of vessel operations, or outright autonomous vessel operations, are science fiction pipedreams, I urge you to take a moment to reflect on the role that technology and innovation has taken in reshaping our touch points in modern business. While autonomous vessels may not reflect the dynamics addressed in Professor Clayton Christensen Theory of Disruptive Innovation, it does have the potential to significantly impact the way that goods are transported.

The fact is for many operators the choice to employ autonomous ships will, in large part, be driven by the bottom line. In today’s shipping environment, it is a fact of life that spreadsheet analysis of EBITDA calculations is the deciding factor in many operating decisions. The question of manned vs. autonomous vessel operations will be no different. It is also important to realize that just as Minimum Manning Guidelines have become 

Maximum Manning complement on many vessels, minimum levels of autonomous vessel automation will likely be adopted as the default equipage level.

Just as in today’s safety management environment where many operators embrace an acceptable level of loss, that principal will continue to be a guide even with autonomous vessel operations. The simple fact is that this technology will not usher in a Zero Loss Operating Environment.  There will continue to be a cost benefit analysis between a zero loss operation vs. an acceptable level of losses. That is truly the behavior that we need to address.  Ignoring developments, or outright dismissal of the technology, could place operators in the unenviable position of appearing to push back against proposed “Safety Regulations” that are in fact unproven operating systems that will lead to increased costs without demonstrated safety benefits.  

Now what does this mean from a Marine Insurance standpoint? The key point should be to stay engaged with your Broker and Underwriter. At Allianz Global Corporate & Specialty (AGCS), we strive to understand our client’s particular needs from their operational standpoint.  This is not a one size fits all business, and every operating environment presents unique challenges. By staying engaged and understanding your current operations, insurers like AGCS are able to help companies in the maritime industry navigate the challenges that lay ahead. Find an Underwriter who understands your market and will work with you to address your particular needs. Ensuring that you have properly trained and credentialed crew aboard your vessels will continue to be one of the most effective steps that you can take to have a safe and efficient operation, both now and in the future.  

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