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What has been the largest single loss of containers on a vessel in the last 10 years?
On its last voyage, the MOL Comfort was half loaded, carrying 4,382 containers. Enough for its unknown cargo to become the biggest loss in history.
In June 2013, the 8110 teu container ship MOL Comfort broke in two in the Indian Ocean. The descent was very slow and It lasted almost a month, until July 11. The crew was rescued by another container ship, while the two pieces of ship separated, and continued sailing on their own, loaded with containers.
LOST AT SEA
The World Shipping Council (WSC) Containers Lost at Sea Report covering 2020-2021 shows that containers lost overboard represent less than one thousandth of 1% (0.001%) of the roughly 241 million packed and empty containers currently shipped each year.
The WSC estimates that there were on average a total of 1,629 containers lost at sea each year between 2008 – 2021.
The biggest container losses in the last 10 years were:
2014. Svendborg Maersk lost 517 containers in rough weather in the Bay of Biscay.
2015. El Faro sank in a hurricane off the Bahamas losing 33 crew and 391 containers.
2019. MSC Zoe lost 342 boxes in a storm in the North Sea.
2020. ONE APUS lost 1816 in a storm cell in the North Pacific Ocean.
2021. Maersk Essen lost 750 containers in the North Pacific Ocean.
: gcaptain
Cargo claims on the rise
In the insurance industry, there has been a notable increase in #cargoclaims in recent years. Why?
- Loss ratios and expense ratios are rising.
- More frequency and severity of cargo claims.
- An increase in claims being put forward during COVID-19 by freight forwarders, importers and exporters. This is mostly due to a lack of operational income. Every penny counts!
- Mobile apps, virtual appraisals, and artificial intelligence-driven straight-through processing are among the innovations reinventing the claims value chain.
To claim under a Marine Cargo Insurance Policy, contact us.
Maritime Zones: Internal Waters
Internal waters are generally defined in relation to the territorial sea as the waters inside the inner limit of the territorial sea.
But internal waters can exist without a territorial sea, and a territorial sea can exist without internal waters. So, internal waters include littoral areas such as ports, rivers, channels, bays, lakes, and other marine spaces landward of the baseline.
Speaking about the limits of the territorial sea, as claims handlers, what might be interesting to know about internal waters?
?States have the same sovereign jurisdiction over these waters as they do over other territory. The subsoil and the aerial space below and above those areas belong to it.
? The normal baseline for measuring the breadth of the territorial sea is the low-water line along the coast as marked on large-scale charts officially recognized by the Coastal State. [UNCLOS Article 5 ].
Importance of baselines:
✅Fundamental to maritime claims
✅Define outer limits of internal waters
✅Starting point for claiming maritime zones
✅Provide basepoints for generation of limits of national maritime claims and maritime boundary negotiations
? Ships entering internal waters must conform with the rules and regulations of the Coastal or Port State (Port State Control). The Coastal State may exclude foreign flag vessels from its internal waters subject to the right of entry of vessels in distress. The right of innocent passage does not apply in internal waters. The entrance for purposes of commerce, navigation or even fisheries is subject to bilateral agreement with the Coastal State.
? For the purpose of delimiting the territorial sea, and in accordance with the Convention, ” the outermost permanent harbour works which form an integral part of the harbour system are regarded as forming part of the coast” (UNCLOS Article 11), which allows them to be used as support points for the effects of drawing the baselines straight.
? Important areas of internal waters such as navigable rivers have often, however, been subjected to special regimes, eg the international rivers regime as well as the Kiel Canal, the Suez Canal and the Panama Canal.
? All “archipelagic waters” within the outermost islands of an archipelagic state such as Indonesia or the Philippines are also considered internal waters, and are treated the same with the exception that innocent passage through them must be allowed. However, archipelagic states may limit innocent passage to designated sea lanes within these waters.
Freight damage claims: best practices to improve your claims process
Receiving damaged freight is another logistics process. A very inconvenient one at that. Having a set procedure for your claims handling will ease your pain in the face of unexpected freight damage.
This article aims to provide you with some valuable insights into the claims process. Let’s start by defining…
What’s a freight claim?
A shipping claim, cargo claim, logistics claim… They are all one and the same. A freight claim is a legal demand by a shipper or consignee against a carrier having broken the terms of their contract. As a consequence, the claimant seeks financial reimbursement for a loss or damage to their cargo.
However, you can’t assume that the carrier is always liable for damage to your cargo.
What are your responsibilities as a shipper?
There are plenty of variables that can have an impact on your consignment during transportation: weather, warehousing conditions, special handling requirements, to name but a few.
Your carrier won’t be liable if the damage results from your failure to:
- Pack the cargo properly
- Label the packaging correctly
- Provide accurate descriptions on the shipping documents
It’s your responsibility to establish that the goods were given to the carrier in good condition and delivered damaged. Only if you’re able to prove that you kept your end of the deal, will the carrier be held liable for your claim.
Which types of freight damage claims are there?
Visible damage
Concealed damage
Loss
Shortage
What should you do when damage is found at the time of delivery?
- Check each unit for signs of damage.
- Open any packages showing visible signs of damage while the driver is present.
- Record an exact description of the damages on the Bill of Lading (B/L) or Proof of Delivery (POD).
- Take photographs.
- Have the driver sign your copy of the delivery receipt.
- Notify the freight carrier and report damage.
- Store the damaged goods and packaging, as the carrier is entitled to inspect them.
What should you do when damage is found at the time of delivery?
Concealed damage freight claims are damages that aren’t noticeable at delivery (e.g., a product shifting in the packaging).
First and foremost, make sure not to give the driver a “clean receipt”, which would imply no damages occurred while the goods were under the carrier’s responsibility. Instead, mark “pending further review” on the POD.
If you see anything that may point to mishandling (e.g., holes, stains, torn packaging), note it on the delivery receipt. That way, if concealed damages are found subsequently, you’ll be able to prove that something was wrong with the delivery from the start.
And, needless to say, respect the claim time limits. If you take any longer than 5 days, your claim will be void.
How to file a freight damage claim?
If you did your homework upon receipt or inspection of the damaged goods, lodging a claim against the carrier will be a piece of cake.
1. Submit a written claim to the carrier
- Provide information allowing to identify the cargo.
- Assert liability for alleged loss.
- Demand payment of a certain amount of money.
2.Provide all supporting documents
- B/L or POD.
- Photos of the actual damage.
- Original invoice showing the costs paid for the cargo.
- A repair estimate (if applicable)
Now, let’s say you follow all these guidelines. You count on receiving full reimbursement. Until the bubble bursts. You get a freight claim declination letter and wonder…
What’s the reason leading to my freight damage claim being denied?
It could be due to:
• Incomplete or inadequate documentation
For example, an illegible invoice. This sort of issue can be easily solved by submitting the information requested by the carrier.
• Clear POD
If there’s no notation of damage on the proof of delivery, it is understood that the freight was received in good condition. The carrier will be entitled to decline the claim.
• Act or omission of the shipper
Imagine your cargo is hazardous material, and it wasn’t packaged and labelled as such. Any damage arising during transit would be your fault, so you wouldn’t be entitled to receive any reimbursement.
• Act of God
Let’s face it: volcanic eruptions, earthquakes and tornadoes are beyond all human control, so the carrier could not be held liable for any damage to your cargo under those circumstances.
• Freight bill unpaid
Your carrier won’t accept your claim if your freight invoice is outstanding.
• Mitigation
It’s your responsibility to mitigate the claim insofar as possible, whether it be by repairing the item, selling it at a discount or returning it to the supplier. Failure to do so may lead to your freight damage claim being denied.
After reading this article, you may be thinking: “Wow, a freight damage claims process is a lot to handle!”
Save yourself the trouble by relying on Marlin Blue’s expert team to deal with your claim. Check out our success stories to find out how working with us will give you the upper hand in the face of freight damage claims.
War clauses in Marine Cargo Insurance
It has been almost a month since the military conflict in #Ukraine began. This tragic situation has led us to consider the matter of dry shipping, the war regulations under the Institute of Cargo Clauses (ICC).
A Marine Cargo Insurance policy should have an answer for every situation, even when it comes to war risks. Depending on the Country and the market, different wordings and laws are the ones regulating the cargo policies.
However, ICC has the most extensive range of clauses in marine insurance. These clauses were first created by the Institute of London Underwriters. Nowadays,Lloyd’s Market Association via its Joint Cargo Committee (JCC) is the institution in charge of developing and updating the ICC.
The most common ICC are A, B, and C and their associated clauses War and Strike Clauses, among others.
Concerning a war like the one currently happening in Ukraine and the Black Sea, it is absolutely vital to emphasize that the ICC A, B, and C regulate war exclusions on clause number 6.
Given the complexity of war conflicts, and the necessity of covering war risks, different war clauses are available.
Extended types of War Clauses:
? Institute War Clauses (Cargo)
? Institute War Clauses (Air Cargo) (excluding sendings by Post)
? Institute War Clauses (sendings by Post)
Whether you handle claims on behalf of an Insurance Company or Cargo Interest, pay special attention to the risks covered by the IWC as they could apply to the current war situation.
