9 Feb 2016
Migrant crisis: insurance implications
By Lulu Trask
There has been much coverage in the media surrounding what to do should your superyacht encounter migrants, but one interesting point that came up in a recent discussion was this: how would an owner feel about his or her yacht being part of a migrant rescue?
This wasn’t so much a question of their ethics. Most owners we speak to have their philanthropic programmes (see the new philanthropy series in The Superyacht Owner for examples).
One question is, despite an owner’s philanthropic efforts, how many would be happy for the name of their superyacht to appear on the front page, as it most likely the case? A superyacht captain recently speaking to The Crew Report about a past experience when he was working in the commercial sector, highlighted how the name of a vessel appearing in the media could be problematic. “Twenty years ago when I was on a tanker, we picked up 26 Cubans. We brought them to Miami and then signed off. The crew did their utmost to help them. Then a few days later we received an email from the agent that three of the women had accused our crewmembers of sexual harassment,” the captain explains. “It was all in the media and a big problem for the captain, vessel and company.”
So while of course SOLAS requires that if someone’s life is in danger at sea, they must be rescued, it is important to understand the implications of this rescue – a particular consideration when it comes to the superyacht’s insurance.
“This is quite a tricky area, as we know that many captains are concerned with how [a migrant rescue] could develop from a practical point of view,” explains Nicola Kingman, yacht underwriter for The Shipowners’ Club. “For instance, what if the persons they are rescuing damage the interior of the yacht or harass their crew? This is always a risk when involved in these situations, whether the people being rescued are migrants or not.
"The master has a duty to render assistance, but only ‘in so far as he can do so without serious damage to the ship, the crew or the passengers’." - Nicola Kingman, yacht underwriter, The Shipowners’ Club
“The UN Convention on the Law of the Sea [UNCLOS] and the International Convention on Salvage, which govern mandatory search and rescue operations at sea, stipulate that the master has a duty to render assistance, but only ‘in so far as he can do so without serious damage to the ship, the crew or the passengers’,” Kingman continues. “That said, the failure to render assistance to a boat in distress can expose the captain to criminal charges, fines and legal proceedings. It is not a matter of morality but a duty, bound under maritime law.”
This is where respective insurance policies become important. “We would look to assist the assured in covering the reasonable expenses incurred as a result of diversion of the insured yacht, and the landing of stowaways, refugees or persons saved at sea,” reveals Kingman, who adds It is the latter risk that remains the single largest expense during such situations.
But how relevant is the migrant crisis to the superyacht sector? “The increase in migrant traffic within Europe, especially in the Mediterranean which is often the preferred cruising area for yachts, [means the] issue has become more prevalent to the yacht sector,” Kingman asserts.
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