Shipping losses hit a decade low

Allianz cautions shipowners not to skimp on maintenance and pay special attention when laying up ships.    The maritime industry saw the number of total losses remain stable during 2015, declining slightly to 85.
   That is the lowest total for a decade and the second year in a row annual losses fell below 100, said the insurance company Allianz in its annual Safety and Shipping Review.
    Allianz cautions that “While the long-term downward trend in shipping losses is encouraging, the continuing weak global economy, depressed commodity prices and an excess of ships are pressurizing costs and raising safety concerns.”
   It said machinery damage is the most common cause of shipping incidents–36 percent.
   “Preventative measures is often one of the first shipboard expenses to suffer,” Allianz said, adding it has “observed an increase in frequency of losses over the past 12 months, which, for some classes, can likely be attributed to some extent to the economic environment.”
   “As well as impacting investment in vessel maintenance and repair, crewing conditions and training, cost pressures can also impair passenger ship safety, salvage and rescue and safe cargo carrying,” Allianz said.
   “It’s critical that economic pressures do not allow a ‘put it off until later’ safety mentality to develop. Some shipowners are already stretching maintenance to the longest possible intervals, while others are considering laying-up vessels or are already doing so. Vessels which are laid-up for a period of time can return to a market that has moved on technologically. There is a need for standardized layup procedures. Without these, the reactivation of such vessels may result in a ‘painful’ exercise for the industry,” the firm added.
   Allianz said the insurance industry “may need to prepare for a $1 billion-plus loss in the future” because of the growing size of containerships.
   “Two ‘mega ships’ were grounded in February 2016, raising safety concerns about what could happen should a more serious incident occur,” it said.