Global Marine Insurer,
The marine insurance giant, observed that the difficult operating conditions and a sharp economic downturn caused by the pandemic presents a unique set of challenges for marine insurers and maritime operators.
AGCS, in its Safety &Shipping Review 2020, noted that though the shipping industry has continued to operate through the pandemic, despite disruption at ports and to crew changes, reduction in sailing due to restrictions could see loss activity fall in the interim.
It however highlighted challenges that could heighten risks in the face of the pandemic.
The Global Head of
"Hijackings by Somalian pirates may have reduced for now, but incidents have been increasing in
"Ship-owners also face additional cost pressures from a downturn in the economy and trade. We know from past downturns that crew and maintenance budgets are among the first areas that can be cut and this can impact the safe operations of vessels and machinery, potentially causing damage or breakdown, which in turn can lead to groundings or collisions. It is crucial that safety and maintenance standards are not impacted by any downturn."
He added: "According to the report, the
The report, however, stated that in 2019, losses declined for the second successive year, highlighting that the
According to the report, cargo ships with 15 cases accounted for more than a third of vessels lost in the past year, while foundered (sunk/submerged) was the main cause of all total losses, accounting for three in four with 31 cases.
The report noted that bad weather accounted for one in five losses, adding that issues with car carriers and roll-on/roll-off (ro-ro) vessels remain among the biggest safety issues.
"Total losses involving ro-ros are up year-on-year, as well as smaller incidents (up by 20%) - a trend continuing through 2020," it added.
The report further noted that the rise in number and severity of claims on ro-ro vessels was raising concerns explaining that Ro-ros can be more exposed to fire and stability issues than other vessels.
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