Vessel layups have little impact on insurance cover
The U.K. P&I Club on Monday issued guidelines about protection and indemnity cover for laid-up ships to help them prepare and maintain their vessels as more ships are idled by poor demand.
The club also laid out guidelines regarding call returns.
'The club is keen to minimize claims for personal injury, wreck removal, pollution, anti-fouling, environmental contamination and damage to other vessels, underwater cables, beaches and reefs,' it said in a statement. 'Crew claims frequently add up to greater total costs than cargo claims. It would be illogical to base P&I call returns solely on the absence of cargo.'
In the statement the club said, 'the terms of contractual compensation for seamen are now potentially onerous and whether a ship is in layup or in active trading, some medical and injury risks do not change significantly.'
It also added that collision risks are not reduced by laying up, and that the increase in average size of idled ships could increase the potential for collision.
'Normal P&I cover continues during layup, subject to the terms of entry and the rules. As a basic premise, a ship in layup should reduce P&I risks, enabling the club to return a portion of its calls to the owners,' the club said. 'Lay-up arrangements should maintain the security, safety and protection of the vessel, crew and environment, and preserve and maintain the structure and machinery, providing protection against corrosion and static seizure.'
To qualify for a call return, a ship must have been laid up for at least 30 consecutive days after mooring, without cargo on board.
'Ships with cargo on board will not qualify for lay up returns under any circumstances,' the club said.
The guidelines also make a distinction between a 'hot' layup, where seamen serving on the vessel are present, and a 'cold' layup, where they are absent.
'Risk changes when employees are on board as contract compensation amounts are now so high,' the club said.
More information is available here.
Vessel layups have little impact on insurance cover
