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Insurers Brace For Multi Million Dollar Claims From Maersk Honam Fire 03.15.2018

1) The Maersk Honam container ship caught fire in the Arabian Sea in March 2018, killing 4 crew members and leaving hundreds of containers destroyed. 2) Insurers are expecting hundreds of millions of dollars in claims from the fire, which is the largest container ship casualty to date. However, many shippers likely did not purchase marine cargo insurance. 3) Previous large container ship disasters, such as the 2008 MOL Comfort incident, resulted in insured cargo losses of over $300 million. Insurers estimate losses per container on these types of fires range between $50,000-$100,000, but some high value cargo has exceeded $1 million in losses.

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Muhammad Ashari Fitra Rachmannullah
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113 views3 pages

Insurers Brace For Multi Million Dollar Claims From Maersk Honam Fire 03.15.2018

1) The Maersk Honam container ship caught fire in the Arabian Sea in March 2018, killing 4 crew members and leaving hundreds of containers destroyed. 2) Insurers are expecting hundreds of millions of dollars in claims from the fire, which is the largest container ship casualty to date. However, many shippers likely did not purchase marine cargo insurance. 3) Previous large container ship disasters, such as the 2008 MOL Comfort incident, resulted in insured cargo losses of over $300 million. Insurers estimate losses per container on these types of fires range between $50,000-$100,000, but some high value cargo has exceeded $1 million in losses.

Uploaded by

Muhammad Ashari Fitra Rachmannullah
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Insurers Brace for Multi-Million-

Dollar Claims from Maersk Honam


Fire
March 15, 2018 by The Loadstar

Maersk Honam fire in the Arabian Sea.

By Mike Wackett (The Loadstar) – The insurance industry is bracing itself for
hundreds of millions of dollars of claims from the biggest container vessel
casualty to date – but some shippers will not have been insured.

A Maersk spokesman told The Loadstar this week that no decision had yet
been reached on the port of destination for the fire-damaged 15,262
teu Maersk Honam.
However, according to AIS signals received from one of the salvage tugs in
attendance, the still-smouldering vessel is under tow, heading slowly in a NNE
direction, which could suggest Mumbai as a port of refuge.

But before port authorities consider accepting the vessel on a lay-by berth,
they will need to be convinced by the salvage teams that the container fires
have been completely extinguished, which could take several more days.

In the case of the 6,750 teu MSC Flaminia, which caught fire in mid-Atlantic
on 14 July 2013, it was almost two months before a North European port
agreed to accept the ship alongside.

The 2017-built Maersk Honam caught fire on 6 March in the Arabian Sea en
route to the Mediterranean, via Suez, claiming the lives of four seafarers with
a further crew member presumed to be lost.

According to the Indian coastguard pictures, hundreds of containers in the


fore section of the ULCV would seem to be a total loss, but boxes stowed
behind the superstructure and in the aft section appear intact.

The Worst Containership Disasters in Recent History… In Photos

Maersk declared general average on 9 March and appointed Liverpool-based


average adjuster Richards Hogg Lindley to collect the necessary GA security.
It said it had advised cargo owners, including 2M partner MSC, of its decision
to declare GA.

MSC requested its customers to contact their insurance company “so that
your cargo can be released without delay”, adding: “We have not received any
reliable information regarding the condition of your cargo, but we will be sure
to inform you after we are notified”.

However, many of the shippers may not have arranged any marine cargo
insurance and will therefore be in for a nasty shock when the average
adjusters require a substantial deposit before the release of undamaged
containers. The basic concept of GA is that all losses, including salvage, port
and transfer costs are shared between surviving cargo.
Meanwhile, for cargo that was insured, marine reinsurance branches will be
expecting an avalanche of claims for this latest containership casualty.

Insurers have for some time expressed their concerns about their exposure in
the event of a major ULCV casualty. In the case of the 8,110 teu MOL
Comfort which broke its back off the coast of Yemen in 2008, resulting in a
total loss of the ship and its 4,380 containers, the insured cargo loss alone
was reported at some $300m.

Marine insurers typically calculate their average exposure per box at between
$50,000-$100,000, but it was reported that amounts lost from the MOL
Comfort were considerably higher, and there have been instances recorded
by marine insurers where the value of a single pallet packed in a container
has exceeded $1m.

Wackett, Mike (03.15.2018), “Insurers Brace for Multi-Million-Dollar Claims from


Maersk Honam Fire,” The Loadstar, Retrieved March 17, 2018, from:
http://gcaptain.com/insurers-brace-for-multi-million-dollar-claims-from-maersk-
honam-fire/

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