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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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Monday, 02 June 14
SUB-BIT FOB INDONESIA COAL SWAPS LOST GROUND THIS WEEK
COALspot.com: Indonesian coal swaps for average Q3’ 2014 lost on day, week and on month according to AsiaClear OTC coal swap's reports re ...
Monday, 02 June 14
SOUTH CHINA COAL SWAP WAS SHOWING A POSITIVE MOVE IN Q4, INSTEAD OF THIS WEEK'S WEAK TREND
COALspot.com: API 8 CFR South China Coal swaps for average Q3 14 deliveries lost 3.39 percent month on month and closed at US$ 72.65 per mt as on F ...
Sunday, 01 June 14
INDO - INDIA SUPRMAX FREIGHT RATES CONTINUED TO DOWN THIS WEEK
COALspot.com: The freight market was soft this past week as all sectors soften particularly Panamax index was lost 129 points or 12.88% week on wee ...
Friday, 30 May 14
CLEAN COAL PROCESSING & CONVERSION ASIA SUMMIT 2014
Clean Coal Processing & Conversion Asia Summit 2014 will be held on Nov 20-21st, 2014 in Jakarta, Indonesia.
With the cooperation of ...
Friday, 30 May 14
US COAL PRODUCTION RELATIVELY FLAT WEEK ON WEEK
COALspot.com – United States the world's second largest coal producer, produced approximately 18.6 million short tons (mmst) of coal in a ...
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- Wilmar Investment Holdings
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- Anglo American - United Kingdom
- Sinarmas Energy and Mining - Indonesia
- Sojitz Corporation - Japan
- Ministry of Finance - Indonesia
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- Medco Energi Mining Internasional
- PTC India Limited - India
- Latin American Coal - Colombia
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- Offshore Bulk Terminal Pte Ltd, Singapore
- Trasteel International SA, Italy
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- Bukit Baiduri Energy - Indonesia
- Carbofer General Trading SA - India
- Economic Council, Georgia
- Iligan Light & Power Inc, Philippines
- Cement Manufacturers Association - India
- Kumho Petrochemical, South Korea
- Alfred C Toepfer International GmbH - Germany
- New Zealand Coal & Carbon
- Parliament of New Zealand
- Sakthi Sugars Limited - India
- OPG Power Generation Pvt Ltd - India
- Heidelberg Cement - Germany
- The State Trading Corporation of India Ltd
- Electricity Authority, New Zealand
- Makarim & Taira - Indonesia
- Banpu Public Company Limited - Thailand
- Gujarat Electricity Regulatory Commission - India
- Bhatia International Limited - India
- LBH Netherlands Bv - Netherlands
- Borneo Indobara - Indonesia
- Samtan Co., Ltd - South Korea
- Standard Chartered Bank - UAE
- Indian Oil Corporation Limited
- CIMB Investment Bank - Malaysia
- Wood Mackenzie - Singapore
- Thai Mozambique Logistica
- Bhushan Steel Limited - India
- Energy Link Ltd, New Zealand
- Ministry of Transport, Egypt
- VISA Power Limited - India
- Chamber of Mines of South Africa
- Karaikal Port Pvt Ltd - India
- Posco Energy - South Korea
- Semirara Mining and Power Corporation, Philippines
- Attock Cement Pakistan Limited
- Straits Asia Resources Limited - Singapore
- Formosa Plastics Group - Taiwan
- Global Coal Blending Company Limited - Australia
- Cigading International Bulk Terminal - Indonesia
- Renaissance Capital - South Africa
- GMR Energy Limited - India
- Electricity Generating Authority of Thailand
- Sarangani Energy Corporation, Philippines
- Coastal Gujarat Power Limited - India
- Indika Energy - Indonesia
- GVK Power & Infra Limited - India
- Australian Commodity Traders Exchange
- Essar Steel Hazira Ltd - India
- Bulk Trading Sa - Switzerland
- Orica Mining Services - Indonesia
- ICICI Bank Limited - India
- Indogreen Group - Indonesia
- Kaltim Prima Coal - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Indian Energy Exchange, India
- Aboitiz Power Corporation - Philippines
- Uttam Galva Steels Limited - India
- Singapore Mercantile Exchange
- South Luzon Thermal Energy Corporation
- Chettinad Cement Corporation Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Indo Tambangraya Megah - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Goldman Sachs - Singapore
- Savvy Resources Ltd - HongKong
- Minerals Council of Australia
- Vijayanagar Sugar Pvt Ltd - India
- Meralco Power Generation, Philippines
- SMG Consultants - Indonesia
- Ministry of Mines - Canada
- Tata Chemicals Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Metalloyd Limited - United Kingdom
- Thiess Contractors Indonesia
- Romanian Commodities Exchange
- Bukit Asam (Persero) Tbk - Indonesia
- Marubeni Corporation - India
- Semirara Mining Corp, Philippines
- Intertek Mineral Services - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Timah Investasi Mineral - Indoneisa
- Jorong Barutama Greston.PT - Indonesia
- IEA Clean Coal Centre - UK
- Larsen & Toubro Limited - India
- San Jose City I Power Corp, Philippines
- Kideco Jaya Agung - Indonesia
- Central Java Power - Indonesia
- Price Waterhouse Coopers - Russia
- Kapuas Tunggal Persada - Indonesia
- The Treasury - Australian Government
- Australian Coal Association
- IHS Mccloskey Coal Group - USA
- Gujarat Sidhee Cement - India
- Aditya Birla Group - India
- Kartika Selabumi Mining - Indonesia
- Independent Power Producers Association of India
- Deloitte Consulting - India
- Sical Logistics Limited - India
- Bayan Resources Tbk. - Indonesia
- India Bulls Power Limited - India
- Videocon Industries ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Directorate General of MIneral and Coal - Indonesia
- Global Business Power Corporation, Philippines
- ASAPP Information Group - India
- Mjunction Services Limited - India
- Rashtriya Ispat Nigam Limited - India
- Sree Jayajothi Cements Limited - India
- Tamil Nadu electricity Board
- GAC Shipping (India) Pvt Ltd
- International Coal Ventures Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Energy Development Corp, Philippines
- Simpson Spence & Young - Indonesia
- Maheswari Brothers Coal Limited - India
- Vizag Seaport Private Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Oldendorff Carriers - Singapore
- Lanco Infratech Ltd - India
- PNOC Exploration Corporation - Philippines
- Africa Commodities Group - South Africa
- Georgia Ports Authority, United States
- Coalindo Energy - Indonesia
- Meenaskhi Energy Private Limited - India
- Rio Tinto Coal - Australia
- Port Waratah Coal Services - Australia
- Globalindo Alam Lestari - Indonesia
- Edison Trading Spa - Italy
- Dalmia Cement Bharat India
- Leighton Contractors Pty Ltd - Australia
- Directorate Of Revenue Intelligence - India
- Miang Besar Coal Terminal - Indonesia
- McConnell Dowell - Australia
- Bharathi Cement Corporation - India
- Holcim Trading Pte Ltd - Singapore
- Kepco SPC Power Corporation, Philippines
- Siam City Cement PLC, Thailand
- Mintek Dendrill Indonesia
- CNBM International Corporation - China
- European Bulk Services B.V. - Netherlands
- Agrawal Coal Company - India
- Bhoruka Overseas - Indonesia
- Ind-Barath Power Infra Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Star Paper Mills Limited - India
- Power Finance Corporation Ltd., India
- Toyota Tsusho Corporation, Japan
- SN Aboitiz Power Inc, Philippines
- Jindal Steel & Power Ltd - India
- Petron Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- SMC Global Power, Philippines
- TeaM Sual Corporation - Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Eastern Coal Council - USA
- Orica Australia Pty. Ltd.
- PetroVietnam Power Coal Import and Supply Company
- Madhucon Powers Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Eastern Energy - Thailand
- Mercuria Energy - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Salva Resources Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Binh Thuan Hamico - Vietnam
- Coal and Oil Company - UAE
- Interocean Group of Companies - India
- Ambuja Cements Ltd - India
- London Commodity Brokers - England
- Billiton Holdings Pty Ltd - Australia
- Antam Resourcindo - Indonesia
- Riau Bara Harum - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Bukit Makmur.PT - Indonesia
- Planning Commission, India
- Manunggal Multi Energi - Indonesia
- Sindya Power Generating Company Private Ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Commonwealth Bank - Australia
- PowerSource Philippines DevCo
- Central Electricity Authority - India
- The University of Queensland
- Bangladesh Power Developement Board
- Xindia Steels Limited - India
- Siam City Cement - Thailand
- MS Steel International - UAE
- Asmin Koalindo Tuhup - Indonesia
- Jaiprakash Power Ventures ltd
- Grasim Industreis Ltd - India
- Altura Mining Limited, Indonesia
- Baramulti Group, Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
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- Neyveli Lignite Corporation Ltd, - India
- White Energy Company Limited
- Therma Luzon, Inc, Philippines
- Mercator Lines Limited - India
- Parry Sugars Refinery, India
- Malabar Cements Ltd - India
- Indonesian Coal Mining Association
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