Mutual Insurance News

Spain on Monday won backing from Europe's top court in its mutlimillion euros damage claim against The London Steam-Ship Owners Mutual Insurance Association for a massive oil spill on its northwestern coast two decades ago.The 2002 sinking of the Greek oil tanker Prestige, which was sailing to Gibraltar, released an estimated 63,000 tones of foul-smelling black fuel along the Galicia coast and forced the closure of Spain's richest fishing grounds.It led to a lengthy dispute between The London Steam-Ship Owners' Mutual Insurance Association Limited…

If you’ve been working in the marine insurance industry lately, you will have heard about “blockchain” at some point; it is the electronic, distributed ledger, notoriously known for enabling the use of cryptocurrencies such as Bitcoin and Ether. But the blockchain technology’s utility goes beyond cryptocurrencies, potentially offering creative ways to solve other real-world problems. Within blockchain ledgers, the use of ‘smart’ contracts essentially converts contractual obligations into lines of computer protocols, which facilitate, verify, or enforce its performance.

Spain's Supreme Court sentenced the captain of the Prestige oil tanker, which sank off Spain's northwestern coast in 2002, covering thousands of kilometres of coastline in fuel oil, to two years in prison on Tuesday. The captain, Apostolos Mangouras, was convicted of recklessness resulting in catastrophic environmental damage, according to a statement by the court, overturning a previous sentence which cleared him of criminal responsibility. The sinking of the Greek tanker, which was sailing to Gibraltar, released an estimated 63,000 tones of foul-smelling black fuel along the Galicia coast and forced the closure of the country's richest fishing grounds.

North of England P&I Association (North) and Sunderland Marine Mutual Insurance Company Limited (SMMI) merged to form the North Group on Friday 28 February 2014 following approval by the Bank of England’s Prudential Regulatory Authority and other U.K. and overseas regulators. The merger between two of the longest-established and most successful international marine insurance businesses - both of which are based in north-east England - has created one of the largest global marine insurance operations, with a premium income of over $500 million, free reserves of $350 million and total assets of $1,500 million. North Group has been over two years in the making, starting with a strategic alliance between North and SMMI in January 2012.

The members of North of England P&I Association (North) and Sunderland Marine Mutual Insurance Company Limited (SMMI) have voted in favor of the clubs' recent proposals to merge. A target date of February 21, 2014 has been set for the merger, which will create one of the largest marine insurance operations. At their general meeting on 16 January 2014, North's members approved the terms of the merger framework agreement signed by the two north-east England based mutuals last month.

A new survey from Moore Stephens finds that vessel operating costs are expected to rise by more than 3% in both 2013 and 2014. While this news should not be unexpected it is nevertheless bad news for ship owners that continue to struggle with low freight rates and over capacity across several oceangoing sectors. In total the survey examined 10 main cost areas, summarized in charts one and two. Crew expenses, broken in two categories as ‘wages’ and ‘other’ by far dominated the cause of cost escalation, accounted for a 4.5% rise in 2013 and a projected 4.7% rise in 2014.

Oil industry company Offshore Pollution Liability Association Limited (OPOL) has appointed Charles Taylor to provide administrative and financial services following a competitive tender. All offshore operators currently active in exploration and production on the United Kingdom Continental Shelf are party to a voluntary oil pollution compensation scheme known as OPOL. It applies to all offshore facilities from which there is a risk of a discharge of oil causing pollution damage.

A new survey from Moore Stephens finds that vessel operating costs are expected to rise by more than three% in both 2013 and 2014, unwelcome news to shipowners that continue to struggle with low freight rates and over capacity across the oceangoing sectors. The survey is based on responses from key players in the international shipping industry, predominantly shipowners and managers in Europe and Asia. Those responses revealed that vessel operating costs are expected to rise by three% in 2013, and by 3.2% in 2014, with crew wages and P&I insurance the cost categories likely to increase most significantly. Crew wages are expected to increase by 2.4% in 2013 and by 2.5% in 2014, with other crew costs thought likely to go up by 2.1% and 2.2% respectively for the years under review.

News that a recent longshoremen’s strike had effectively stopped cargo operations at the port of Baltimore, a major hub for foreign car imports into the US, underlined the Strike Club’s latest warning that strikes by stevedores continue to dominate the list of perils causing delays. The mutual insurer says that a recent analysis of its claims files shows that, in the 2012-2013 policy year, strikes accounted for 16.8% of claims, followed by collision (14.4%), closure of port or sealane (13.6%), and strikes by port workers (also 13.6%). Total net claims for the year were $16.8m, with mutual claims accounting for $12.0m net. A somewhat similar picture emerges from a review of the five-year period 2008-2013: closure of port or sealane (17.2%)…

Three heroic teams of oarsmen from Thomas Miller P&I in London as well as sister team at Thomas Miller Asia-Pacific have all successfully completed their legs of the Big Row charity event. In total some eighty teams from the international maritime community took part in a 'virtual' row of the length of Lake Malawi to raise funds for the ongoing refurbishment of the 'MV Chauncy Maples' as a medical clinic ship. The main event took place in Spitalfields Market in the City of London on the evening of the 11th September.

The North of England P&I Association Limited (North) and Sunderland Marine Mutual Insurance (SMMI) Company Limited are discussing a possible merger. The decision by the boards and senior management teams of the two north-east England based mutuals follows a strategic alliance, by way of a reinsurance contract between the two companies, which commenced in January 2012. North's Chairman Pratap Shirke says, ‘As a result of the business similarities between North and SMMI and their complementary global operations, we have now agreed in principle to investigate the practicalities of a merger.

The early months of 2013 have been marked by damaging labor strike action in several countries which has punished shipowners and charterers even though they are innocent parties, says The Strike Club, the market leader for delay insurance for the marine trades. Some of the worst trouble spots in recent weeks have been in South America, particularly Chile where a three-week strike crippled the country’s key ports, blocking exports of copper (Chile is the world’s largest producer of this metal), fruit and wood products. Chile’s business leaders estimated the country lost more than $200 million a day due to the conflict. There has been a miners’ strike in Colombia…

Specialist liability insurer for the international transport and logistics industry TT Club said it had another good performance for the year ended December 31, 2012, with further increased gross written premiums, and the club now maintains its A- (Excellent) rating for the past eight years. In a statement, U.S. rating agency A M Best reaffirmed the financial strength rating of A- (Excellent) and the issuer credit ratings of “a-” of Through Transport Mutual Insurance Association Limited (TTB) (Bermuda) and its subsidiary…

Speaking at the Panama Maritime VI World Conference, Dan Negron, vice president at Through Transport Mutual Services (Americas), stated that port operators face significant liability risk unless they are properly advised by specialist insurers and are in possession of a bespoke port and terminals policy. The devastation caused to New York in the September 11 terrorist attacks has inevitably led to repercussions in the insurance markets. Reports from market analysts contain the sobering conclusion that reinsurance capacity will diminish significantly in the foreseeable future. Consequently, many weaker insurers will either restrict their coverages, or will consolidate with others in order to maintain their capacity.

In an unpublished opinion, the U.S. Court of Appeals for the Sixth Circuit affirmed a district court’s confirmation of a British arbitration award in favor of a protection and indemnity (P&I) club against plaintiff seamen. Acting on behalf of the seamen, a law firm sued States Steamship Company for alleged asbestos-related injuries. When States, which was in bankruptcy, did not answer, plaintiffs obtained a default judgment. Suit was then brought against two P&I Clubs that had insured States. One club prevailed on the “pay to be paid” provision in its policy. The suit against the second club was referred to arbitration in Britain in accordance with terms in the policy. The British arbitration was in favor of the club and included an award of legal costs and fees against plaintiffs.

The North of England P&I Association Limited (North) and Sunderland Marine Mutual Insurance (SMMI) Company Limited are discussing a possible merger. The decision by the boards and senior management teams of the two north-east England based mutuals follows a strategic alliance, by way of a reinsurance contract between the two companies, which commenced in January 2012. North’s chairman Pratap Shirke said, “As a result of the business similarities between North and SMMI and their complementary global operations, we have now agreed in principle to investigate the practicalities of a merger. SMMI’s chairman Trevor Hart said, “SMMI and North…

The U.S. Court of Appeals for the Eleventh Circuit ruled that a vessel tied off to a mooring buoy is anchored, rather than moored. In the instant case, defendant's barge was tied off to a mooring buoy outside the regular navigation channel. The barge was not lit at night, nor was it sounding fog signals. Plaintiff's shrimp boat got off course at night in the fog and allided with the barge. Defendant contended that it did not contribute to the allision. The court held that, since the barge was anchored, rather than moored, and was not lit and was not sounding signals, that it was in violation of the navigation rules. Sunderland Marine Mutual Insurance Co., Ltd. v. Weeks Marine Construction Co. Source: HK Law

The U.S. Court of Appeals for the Eleventh Circuit ruled that a vessel tied off to a mooring buoy is anchored, rather than moored. In the instant case, defendant's barge was tied off to a mooring buoy outside the regular navigation channel. The barge was not lit at night, nor was it sounding fog signals. Plaintiff's shrimp boat got off course at night in the fog and allided with the barge. Defendant contended that it did not contribute to the allision. The court held that, since the barge was anchored, rather than moored, and was not lit and was not sounding signals, that it was in violation of the navigation rules. Sunderland Marine Mutual Insurance Co., Ltd. v. Weeks Marine Construction Co. Source: HK Law

Managers of The Strike Club were able to give an upbeat report to the club’s directors when they met in Istanbul. Ongoing increased demand for the club’s various insurance covers has resulted in strong growth and a very positive renewal in February for the 2012/13 year. Further, free reserves rose by $2.5m. during the latest financial year, and the club has maintained its S&P rating at BBB+ with a stable outlook. The mutual renewal was stamped by a 92% retention rate despite the…

Wikborg Rein, a Norwegian law firm, said Norway's Supreme Court has closed a door to claimants attempting to act against foreign shipowners insuring themselves in Norway. against a major Russian shipowner. company in Norway because it had its P&I cover with Oslo-based Skuld. has an asset in the country. mutual insurance company owned by its members. but the Supreme Court rejected the forum shopping. itself constitute a sufficient connection with Norway. relevant under Section 32. claims may also constitute an asset. parties domiciled in a country which is party to the Lugano Convention. European Union or the European Free Trade Association member states. constitute a sufficient connection with Norway. can sleep a little easier," says Faerden.

The International Chamber of Shipping (ICS), which represents over 80% of the world merchant fleet, has welcomed the decision by the European Commission competition directorate to close its investigation into the activities of the International Group of P&I Clubs. “ICS has always firmly stated that the current system of mutual third party liability insurance provided by the International Group continues to serve the best interests of ship operators and their customers extremely well, alongside serving the interests of claimants and the general public.

International Chamber of Shipping (ICS) welcomes halt to European Commission (EC) probe on P&I clubs. International Chamber of Shipping (ICS), which represents over 80% of the world merchant fleet, has welcomed the decision by the European Commission competition directorate to close its investigation into the activities of the International Group of P&I Clubs. ICS director of legal affairs , Kiran Khosla said: "ICS has always firmly stated that the current system of mutual third party liability insurance provided by the International Group continues to serve the best interests of ship operators and their customers extremely well, alongside serving the interests of claimants and the general public.

The Chesapeake Marine Training Institute (CMTI) offers a maritime safety program specifically for commercial fishing vessels. “Since its inception, hundreds of boats and crew members have completed the program and the demand just keeps increasing,” said John O’Leary, maritime safety instructor for CMTI and the head of the safety and survival program. “In an industry that is already struggling, the program is becoming increasingly requested and thanks to the funding of the insurance companies, we can continue to grow and increase its numbers.” This program is offered by Sunderland Marine Mutual Insurance Company, Ltd through Brown and Brown Flagship in a joint effort to reduce casualties.