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Wednesday, 13 August 14
WHAT DOES PROJECT CARGO REALLY MEAN TO INSURERS?
 KNOWLEDGE TO ELEVATE
Richard Kamppari-Baker, claims manager of FP Marine Risks, explains the challenges of project cargo risk assessment from an insurer’s point of view.
Project cargo is the large, oversized, overweight heavy lift cargo or critical pieces of equipment that may be high value or time sensitive and sometimes both. Project cargo insurance covers against loss or damage in transit for critical components of large civil, production facility, infrastructure, and/or construction projects.
Considerations
In addition, there are considerations to be taken into account for Delay in Start up (DSU) and Advanced Loss of Profits (ALOP) against loss of income and profit arising from late or non-delivery of critical components due to an accidental occurrence in transit.
Failure of a shipment to arrive, or not arrive intact, can turn a USD10 million cargo loss into a claim ten times its value when factoring in the knock-on effects of one piece of equipment not being ready at a particular date, which then causes disastrous consequences to the project as a whole. Whilst failure of any cargo to arrive has an enormous impact on operations, for project cargo this has far reaching ramifications.
For this reason the assured look towards insurers to cover the additional economic cost when something goes wrong.
Evaluating risk
Insurers will only compensate the assured for the loss or put it back in the same position. So how does an underwriter even start to evaluate the risk when the consequences are not easily apparent? Project cargo is specifically dependent on transport logistics and tight timeframes, so missing any goal or target will have serious knock-on effects.
To begin a proper assessment of the exposure, a few crucial factors need to be considered. The time and costs for re-fabrication as well as for reshipping the item need to be calculated, which is not an easy task when the bespoke nature of these items is considered.
During this time, insurers will need to calculate the knock-on effects when other goals or targets cannot be met. This means they need to evaluate the loss of profit and/or other operational costs at each stage affected until the project is completed. This is by no means guesswork and there is a complex system involved in calculating each risk.
Appraising the exposure is only part of the problem to insurers because one must consider how to move such an item. Project cargo will most likely be out-of-gauge or exceed regular weight limits, so the question is how the transport is to be done. Moving pylons across muddy roads in India during monsoon season, or loading reactors onto vessels, need the highest level of expertise. The services of engineers, surveyors, mariners, naval architects, consultants and government officials will be required. Careful consideration is essential in deciding who to employ.
Relevant experience
A major factor is to ensure the right people with the relevant experience are chosen. A team of international experts may need to be flown out at each stage of the transit. A key role is an individual who will be in charge of coordinating all communications amongst the team, ensuring all members are properly informed whilst avoiding any misunderstanding whatsoever.
Once the determined route has been scrutinised, the next stage is to ensure all requirements are met. Inland transits often require special authorization or conditions and vessels might need special clearance from their P&I clubs or insurers.
Insurers are very reliant on the assured and other experts to advise on stowage and on whether an item is capable of withstanding the rigours of transit. Items that protrude or carry extreme weights present a huge problem while stationary, but these complications are magnified tenfold when combined with extreme forces of rolling and pitching while in transit.
Calculations need to be carried out by professionals, securing contractors to ensure correct fastenings, buttresses, and so on, are used. Stability during the voyage is essential, so great care is taken to ensure the centre of gravity is evenly distributed.
All the advice from the experts is only as good as Mother Nature permits. A final weather routing will often need to be agreed before the shipment can commence.
No matter how fastidious insurers, carriers, freight forwarders and shippers are, there is a chance that an accident will happen. Claims will of course arise when route surveys are not properly carried out of when stowage of fittings are not adequate.
There will always be unforeseen events that cannot be predicted. The role of the insurer is not to take a gamble on whether a shipment will arrive in time and good order, but to know the risks and eliminate the uncertainties. For project cargo this is critically important, given the high cargo values and the potentially enormous claims involved.
Source: FP Marine / Hellenic Shipping
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Thursday, 28 August 14
PANAMAX: OWNERS CAN GET AROUND USD 16000 FOR A FRONTHAUL; PERIOD MARKET - VERY QUIET - FEARNLEYS
Handy
The activity and sentiment is improving in the Atlantic with the general TA rate is up about US$ 800 w-o-w. We see more South American carg ...
Thursday, 28 August 14
BANPU REPORTS HIGHER FIRST-HALF YEAR RESULTS FOR 2014
COALspot.com: Banpu Public Company Limited (BANPU) reports higher first half-year financial results for 2014 having its gross profit increasing 3 p ...
Wednesday, 27 August 14
FREIGHT MARKET: IS THE MARKET IN A RECOVERY MOOD? - GEORGE ILIOPOULOS
Is the market in a recovery mood?
August is typically a time when the shipping industry takes it easy… charter-ers book their requireme ...
Tuesday, 26 August 14
4TH ANNUAL ASIA NICKEL
4th Annual Asia Nickel
19-20 Nov 2014
Grand Hyatt Jakarta, Indonesia
Web Site
Asia’s Premier Nickel Conference
Regulation in ...
Tuesday, 26 August 14
DESPITE LOW DRY BULK RATES, BULKER PRICES ARE STILL HIGH - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Traditionally, August tends to be a month of slow activity in the sale and purchasing market and this year has been no exception. However, as shipb ...
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- GAC Shipping (India) Pvt Ltd
- PowerSource Philippines DevCo
- Goldman Sachs - Singapore
- Semirara Mining and Power Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- Trasteel International SA, Italy
- Leighton Contractors Pty Ltd - Australia
- Sical Logistics Limited - India
- Lanco Infratech Ltd - India
- Tamil Nadu electricity Board
- The Treasury - Australian Government
- Bhatia International Limited - India
- Thai Mozambique Logistica
- Kepco SPC Power Corporation, Philippines
- Simpson Spence & Young - Indonesia
- Coastal Gujarat Power Limited - India
- Ambuja Cements Ltd - India
- Mintek Dendrill Indonesia
- Bhushan Steel Limited - India
- Toyota Tsusho Corporation, Japan
- Vizag Seaport Private Limited - India
- AsiaOL BioFuels Corp., Philippines
- Jorong Barutama Greston.PT - Indonesia
- Antam Resourcindo - Indonesia
- Bukit Makmur.PT - Indonesia
- Cement Manufacturers Association - India
- Port Waratah Coal Services - Australia
- Australian Coal Association
- PetroVietnam Power Coal Import and Supply Company
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- TNB Fuel Sdn Bhd - Malaysia
- Timah Investasi Mineral - Indoneisa
- Bharathi Cement Corporation - India
- Power Finance Corporation Ltd., India
- Intertek Mineral Services - Indonesia
- Indian Energy Exchange, India
- Ministry of Mines - Canada
- Uttam Galva Steels Limited - India
- Vedanta Resources Plc - India
- Independent Power Producers Association of India
- SN Aboitiz Power Inc, Philippines
- Thiess Contractors Indonesia
- ASAPP Information Group - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Therma Luzon, Inc, Philippines
- Meralco Power Generation, Philippines
- SMG Consultants - Indonesia
- LBH Netherlands Bv - Netherlands
- Parliament of New Zealand
- Formosa Plastics Group - Taiwan
- Kideco Jaya Agung - Indonesia
- VISA Power Limited - India
- Sinarmas Energy and Mining - Indonesia
- Barasentosa Lestari - Indonesia
- Madhucon Powers Ltd - India
- Singapore Mercantile Exchange
- Ind-Barath Power Infra Limited - India
- San Jose City I Power Corp, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
- Global Green Power PLC Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Central Electricity Authority - India
- Indonesian Coal Mining Association
- Kobexindo Tractors - Indoneisa
- Interocean Group of Companies - India
- Miang Besar Coal Terminal - Indonesia
- Bangladesh Power Developement Board
- Central Java Power - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Gujarat Electricity Regulatory Commission - India
- GVK Power & Infra Limited - India
- PNOC Exploration Corporation - Philippines
- Australian Commodity Traders Exchange
- Iligan Light & Power Inc, Philippines
- IEA Clean Coal Centre - UK
- Videocon Industries ltd - India
- Carbofer General Trading SA - India
- Makarim & Taira - Indonesia
- Edison Trading Spa - Italy
- Grasim Industreis Ltd - India
- Siam City Cement - Thailand
- Neyveli Lignite Corporation Ltd, - India
- Attock Cement Pakistan Limited
- Rashtriya Ispat Nigam Limited - India
- Chamber of Mines of South Africa
- Romanian Commodities Exchange
- PTC India Limited - India
- Global Business Power Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- Standard Chartered Bank - UAE
- Sarangani Energy Corporation, Philippines
- Oldendorff Carriers - Singapore
- Metalloyd Limited - United Kingdom
- Siam City Cement PLC, Thailand
- Tata Chemicals Ltd - India
- Meenaskhi Energy Private Limited - India
- Africa Commodities Group - South Africa
- Globalindo Alam Lestari - Indonesia
- Samtan Co., Ltd - South Korea
- Latin American Coal - Colombia
- Karbindo Abesyapradhi - Indoneisa
- Eastern Coal Council - USA
- London Commodity Brokers - England
- Agrawal Coal Company - India
- Coalindo Energy - Indonesia
- Directorate Of Revenue Intelligence - India
- Savvy Resources Ltd - HongKong
- Riau Bara Harum - Indonesia
- Renaissance Capital - South Africa
- Posco Energy - South Korea
- Wood Mackenzie - Singapore
- Wilmar Investment Holdings
- South Luzon Thermal Energy Corporation
- Altura Mining Limited, Indonesia
- Kartika Selabumi Mining - Indonesia
- Price Waterhouse Coopers - Russia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- European Bulk Services B.V. - Netherlands
- Bahari Cakrawala Sebuku - Indonesia
- Eastern Energy - Thailand
- Energy Link Ltd, New Zealand
- Bukit Asam (Persero) Tbk - Indonesia
- Binh Thuan Hamico - Vietnam
- GN Power Mariveles Coal Plant, Philippines
- GMR Energy Limited - India
- Essar Steel Hazira Ltd - India
- Aditya Birla Group - India
- Ministry of Finance - Indonesia
- Chettinad Cement Corporation Ltd - India
- Star Paper Mills Limited - India
- Georgia Ports Authority, United States
- Ceylon Electricity Board - Sri Lanka
- Jindal Steel & Power Ltd - India
- Dalmia Cement Bharat India
- Maharashtra Electricity Regulatory Commission - India
- Pendopo Energi Batubara - Indonesia
- Mjunction Services Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Larsen & Toubro Limited - India
- Sindya Power Generating Company Private Ltd
- Kumho Petrochemical, South Korea
- Salva Resources Pvt Ltd - India
- Marubeni Corporation - India
- Bulk Trading Sa - Switzerland
- Bukit Baiduri Energy - Indonesia
- McConnell Dowell - Australia
- Heidelberg Cement - Germany
- Alfred C Toepfer International GmbH - Germany
- Electricity Authority, New Zealand
- Merrill Lynch Commodities Europe
- ICICI Bank Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Planning Commission, India
- Cigading International Bulk Terminal - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Mercuria Energy - Indonesia
- Medco Energi Mining Internasional
- Kapuas Tunggal Persada - Indonesia
- CIMB Investment Bank - Malaysia
- MS Steel International - UAE
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Banpu Public Company Limited - Thailand
- Global Coal Blending Company Limited - Australia
- Sojitz Corporation - Japan
- White Energy Company Limited
- Jaiprakash Power Ventures ltd
- TeaM Sual Corporation - Philippines
- IHS Mccloskey Coal Group - USA
- Commonwealth Bank - Australia
- Gujarat Mineral Development Corp Ltd - India
- Coal and Oil Company - UAE
- Indogreen Group - Indonesia
- OPG Power Generation Pvt Ltd - India
- Xindia Steels Limited - India
- Orica Australia Pty. Ltd.
- Economic Council, Georgia
- Semirara Mining Corp, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Directorate General of MIneral and Coal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Bhoruka Overseas - Indonesia
- New Zealand Coal & Carbon
- SMC Global Power, Philippines
- Minerals Council of Australia
- Bayan Resources Tbk. - Indonesia
- Deloitte Consulting - India
- Billiton Holdings Pty Ltd - Australia
- The University of Queensland
- Parry Sugars Refinery, India
- Energy Development Corp, Philippines
- Ministry of Transport, Egypt
- Straits Asia Resources Limited - Singapore
- Electricity Generating Authority of Thailand
- Indika Energy - Indonesia
- Indian Oil Corporation Limited
- Borneo Indobara - Indonesia
- Anglo American - United Kingdom
- The State Trading Corporation of India Ltd
- Manunggal Multi Energi - Indonesia
- India Bulls Power Limited - India
- Kaltim Prima Coal - Indonesia
- Gujarat Sidhee Cement - India
- Sree Jayajothi Cements Limited - India
- Karaikal Port Pvt Ltd - India
- CNBM International Corporation - China
- Baramulti Group, Indonesia
- Orica Mining Services - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Sakthi Sugars Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Malabar Cements Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Holcim Trading Pte Ltd - Singapore
- Mercator Lines Limited - India
- Petron Corporation, Philippines
- Rio Tinto Coal - Australia
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