By
Adam Lawrence |
Lloyd’s insurers are increasingly anxious about accepting ferry industry contracts, according to one maritime P&I specialist.
Simon Swallow, commercial director of the UK-based Shipowners P&I Club, told delegates at the recent Interferry conference in Barcelona that his informal research had found only three or four Lloyd’s insurers prepared to accept ferry hull & machinery business after consistently losing money and failing to achieve the required increase in premiums.
One market leader told Swallow of loss ratios of 153 per cent on ferries and 189 per cent on RoRo ships compared with 115 per cent across all sectors. This, Swallow said, was mainly due to machinery incidents, notably because of the strain of maintaining tight schedules and because ‘there are a lot of old ferries out there’.
Swallow explained that hull and machinery insurers did not like high-speed craft because engines were working at full capacity and spares costs were high. Liability insurers preferred fast ferries to conventional vessels because passengers were strapped in, there was high technology on board and stopping distances were short, but were alarmed at major increases in exposure under the EU passenger liability convention due in force late next year. Crew fatigue, competence and over-familiarity with scheduled routes were common concerns.
He advised: “Ultimately solvency could depend on the quality of your insurance company. Work with them, show them your attention to safety and you will see your costs reduce.”