29th August 2018

More infrastructure support required to facilitate insurance for Arctic sailings, urges IUMI

Client news

The change in ice conditions is opening the high Arctic as a trade route, fishing ground and potential tourism destination; but more infrastructure support is required to facilitate the provision of adequate insurance, says IUMI in a position paper released today.

Helle Hammer, IUMI’s chair of its Policy Forum and co-author of the position paper says:

“The marine insurance sector, like all sectors, wants to see enhanced safety for ships operating in Arctic waters. We would strongly encourage an improved infrastructure to provide the required level of search & rescue capacity alongside suitable places of refuge. We would also like to see updated surveys and more reliable charting of the region. This would assist marine underwriters to quantify the risks involved”.

IUMI’s position paper lists a number of considerations to be taken into account when assessing individual voyage risk. These include regional rescue and salvage facilities, potential places of refuge, expected weather conditions, experience of crew and the operational performance of the vessel itself.

Historical information - due to the current limited number of sailings and constantly changing ice conditions -  is not available and this is forcing marine insurers to take a more cautious approach to risk assessment.

Helle Hammer explains:

“When assessing risk for insurance purposes, historical loss data is a key factor, and that’s missing for Polar operations. This means that underwriters must assess each voyage on a case-by-case basis. Alongside the availability of suitable infrastructure, IUMI is encouraging insurers to consider the vessel’s Polar Ship Certificate and take into account the vessel operator’s level of preparedness and planning.”

IUMI is an active supporter of the Polar Code (International Code for Ships Operating in Polar Waters) as a method for lowering the risks associated with Arctic sailings. IUMI would also like to see an instrument in place for non-SOLAS vessels (ships of less than 500 GT, including fishing vessels) to ensure there is a safer regime for all vessels operating in Arctic waters.

IUMI believes the sharing of best practice is also important and is pleased to participate in the Arctic Shipping Best Practice Information Forum.

The position paper is available from IUMI’s website: https://iumi.com/opinions/position-papers

Ends


Notes to editors:
The International Union of Marine Insurance (IUMI) represents 40 national and marine market insurance and reinsurance associations. Operating at the forefront of marine risk, it gives a unified voice to the global marine insurance market through effective representation and lobbying activities. As a forum for the exchange of ideas and best practice, IUMI works to raise standards across the industry and provides opportunities for education and the collection and publication of industry statistics. IUMI is headquartered in Hamburg and traces its roots back to 1874.

More information can be found at www.iumi.com