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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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Wednesday, 02 July 14
HANDY BULKERS PROVE TO BE THE MOST SOUGHT AFTER VESSELS OVER THE PAST WEEK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The Handy dry bulker proved to be the most sought after ship by ship owners active in the second hand market, which saw a slight decline in terms o ...
Wednesday, 02 July 14
SHIPPING: MARKET INSIGHT - GEORGE DERMATIS
After 6 months, 57 ministerial meetings and 67 political agreements, the journey of the Greek Presidency in the EU reached its end yesterday; only ...
Tuesday, 01 July 14
INDIAN POWER PLANT COAL STOCKPILES VERY LOW
COALspot.com: According to today's Weekly Dry Bulk Report published by Commodore Research, Indian power plant coal stockpiles have now fallen t ...
Monday, 30 June 14
SUB-BIT FOB INDONESIA COAL PRICES ARE STILL STRUGGLING TO RECOVER
COALspot.com: Indonesian coal swaps for average Q3’ 2014 lost on week and on month according to AsiaClear OTC coal swap's reports release ...
Monday, 30 June 14
WEEKLY CFR SOUTH CHINA COAL SWAPS DECLINE CONTINUES; Q1'15 LOST US$ 4.55 PMT IN A WEEK
COALspot.com: API 8 CFR South China Coal swap for delivery in Q3 fell US$ 5.25 month on month on Friday, dipping under $69 a tone. The CFR South Ch ...
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- Xindia Steels Limited - India
- Manunggal Multi Energi - Indonesia
- Attock Cement Pakistan Limited
- Renaissance Capital - South Africa
- Port Waratah Coal Services - Australia
- Kartika Selabumi Mining - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Kumho Petrochemical, South Korea
- Vedanta Resources Plc - India
- Merrill Lynch Commodities Europe
- Malabar Cements Ltd - India
- Kideco Jaya Agung - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Wood Mackenzie - Singapore
- Petron Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Mjunction Services Limited - India
- Ministry of Transport, Egypt
- Meralco Power Generation, Philippines
- Standard Chartered Bank - UAE
- Carbofer General Trading SA - India
- Electricity Authority, New Zealand
- Videocon Industries ltd - India
- India Bulls Power Limited - India
- Bharathi Cement Corporation - India
- Edison Trading Spa - Italy
- New Zealand Coal & Carbon
- Maheswari Brothers Coal Limited - India
- Australian Coal Association
- Electricity Generating Authority of Thailand
- Global Green Power PLC Corporation, Philippines
- Commonwealth Bank - Australia
- Ministry of Mines - Canada
- OPG Power Generation Pvt Ltd - India
- Ambuja Cements Ltd - India
- Price Waterhouse Coopers - Russia
- LBH Netherlands Bv - Netherlands
- Karbindo Abesyapradhi - Indoneisa
- Madhucon Powers Ltd - India
- San Jose City I Power Corp, Philippines
- Planning Commission, India
- SMC Global Power, Philippines
- Savvy Resources Ltd - HongKong
- Latin American Coal - Colombia
- Pipit Mutiara Jaya. PT, Indonesia
- Coalindo Energy - Indonesia
- Altura Mining Limited, Indonesia
- Economic Council, Georgia
- Straits Asia Resources Limited - Singapore
- PetroVietnam Power Coal Import and Supply Company
- Iligan Light & Power Inc, Philippines
- CIMB Investment Bank - Malaysia
- European Bulk Services B.V. - Netherlands
- Holcim Trading Pte Ltd - Singapore
- Indian Energy Exchange, India
- Romanian Commodities Exchange
- Mintek Dendrill Indonesia
- Parry Sugars Refinery, India
- Sakthi Sugars Limited - India
- Medco Energi Mining Internasional
- Energy Development Corp, Philippines
- Krishnapatnam Port Company Ltd. - India
- ICICI Bank Limited - India
- Chettinad Cement Corporation Ltd - India
- Indonesian Coal Mining Association
- Bulk Trading Sa - Switzerland
- Riau Bara Harum - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- White Energy Company Limited
- Gujarat Sidhee Cement - India
- Siam City Cement - Thailand
- Kohat Cement Company Ltd. - Pakistan
- Kepco SPC Power Corporation, Philippines
- Bangladesh Power Developement Board
- IEA Clean Coal Centre - UK
- Oldendorff Carriers - Singapore
- The State Trading Corporation of India Ltd
- Heidelberg Cement - Germany
- London Commodity Brokers - England
- VISA Power Limited - India
- Energy Link Ltd, New Zealand
- Simpson Spence & Young - Indonesia
- SMG Consultants - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Antam Resourcindo - Indonesia
- Globalindo Alam Lestari - Indonesia
- Larsen & Toubro Limited - India
- Billiton Holdings Pty Ltd - Australia
- Chamber of Mines of South Africa
- Formosa Plastics Group - Taiwan
- Kaltim Prima Coal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Anglo American - United Kingdom
- Interocean Group of Companies - India
- Kalimantan Lumbung Energi - Indonesia
- Marubeni Corporation - India
- Bhushan Steel Limited - India
- Minerals Council of Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Wilmar Investment Holdings
- Mercuria Energy - Indonesia
- Jaiprakash Power Ventures ltd
- Trasteel International SA, Italy
- Indian Oil Corporation Limited
- Bukit Baiduri Energy - Indonesia
- Georgia Ports Authority, United States
- GAC Shipping (India) Pvt Ltd
- Grasim Industreis Ltd - India
- Ministry of Finance - Indonesia
- Central Java Power - Indonesia
- South Luzon Thermal Energy Corporation
- IHS Mccloskey Coal Group - USA
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Leighton Contractors Pty Ltd - Australia
- Directorate Of Revenue Intelligence - India
- Barasentosa Lestari - Indonesia
- The University of Queensland
- Sindya Power Generating Company Private Ltd
- Aditya Birla Group - India
- Indika Energy - Indonesia
- Pendopo Energi Batubara - Indonesia
- Bukit Makmur.PT - Indonesia
- Siam City Cement PLC, Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Timah Investasi Mineral - Indoneisa
- McConnell Dowell - Australia
- Bhatia International Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Jindal Steel & Power Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Lanco Infratech Ltd - India
- Goldman Sachs - Singapore
- MS Steel International - UAE
- Australian Commodity Traders Exchange
- Orica Australia Pty. Ltd.
- Miang Besar Coal Terminal - Indonesia
- PNOC Exploration Corporation - Philippines
- Coastal Gujarat Power Limited - India
- Rio Tinto Coal - Australia
- Cement Manufacturers Association - India
- Alfred C Toepfer International GmbH - Germany
- Kobexindo Tractors - Indoneisa
- Independent Power Producers Association of India
- Jorong Barutama Greston.PT - Indonesia
- Power Finance Corporation Ltd., India
- Vizag Seaport Private Limited - India
- Uttam Galva Steels Limited - India
- Meenaskhi Energy Private Limited - India
- Posco Energy - South Korea
- Eastern Coal Council - USA
- Semirara Mining and Power Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Banpu Public Company Limited - Thailand
- Toyota Tsusho Corporation, Japan
- Africa Commodities Group - South Africa
- Global Coal Blending Company Limited - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Indogreen Group - Indonesia
- ASAPP Information Group - India
- PTC India Limited - India
- International Coal Ventures Pvt Ltd - India
- Singapore Mercantile Exchange
- Thiess Contractors Indonesia
- Tata Chemicals Ltd - India
- Central Electricity Authority - India
- GMR Energy Limited - India
- Maharashtra Electricity Regulatory Commission - India
- SN Aboitiz Power Inc, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Global Business Power Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Binh Thuan Hamico - Vietnam
- Tamil Nadu electricity Board
- Gujarat Mineral Development Corp Ltd - India
- Baramulti Group, Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Bayan Resources Tbk. - Indonesia
- Semirara Mining Corp, Philippines
- Aboitiz Power Corporation - Philippines
- Borneo Indobara - Indonesia
- Eastern Energy - Thailand
- Dalmia Cement Bharat India
- Gujarat Electricity Regulatory Commission - India
- CNBM International Corporation - China
- Kapuas Tunggal Persada - Indonesia
- Mercator Lines Limited - India
- Metalloyd Limited - United Kingdom
- Salva Resources Pvt Ltd - India
- Sojitz Corporation - Japan
- Essar Steel Hazira Ltd - India
- Agrawal Coal Company - India
- Therma Luzon, Inc, Philippines
- GVK Power & Infra Limited - India
- Bhoruka Overseas - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Makarim & Taira - Indonesia
- Samtan Co., Ltd - South Korea
- Sical Logistics Limited - India
- The Treasury - Australian Government
- Star Paper Mills Limited - India
- Thai Mozambique Logistica
- Vijayanagar Sugar Pvt Ltd - India
- PowerSource Philippines DevCo
- TNB Fuel Sdn Bhd - Malaysia
- Parliament of New Zealand
- Ceylon Electricity Board - Sri Lanka
- Bank of Tokyo Mitsubishi UFJ Ltd
- Orica Mining Services - Indonesia
- Karaikal Port Pvt Ltd - India
- Coal and Oil Company - UAE
- Sarangani Energy Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- AsiaOL BioFuels Corp., Philippines
- Deloitte Consulting - India
- Intertek Mineral Services - Indonesia
- Indo Tambangraya Megah - Indonesia
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