IMO Jakarta Meeting on the Straits of Malacca and Singapore: Enhancing Safety, Security and Environmental Protection,” 7th and 8th September 2005

Submission by the International Group of  P&I Clubs “IMO Jakarta Meeting on the Straits of Malacca and Singapore: Enhancing Safety, Security and Environmental Protection,” 7th and 8th September 2005

The member associations of the International Group of P&I Clubs (IG) collectively provide liability insurance to about 90 per cent of the world’s ocean going fleet. This Submission comments upon the loss prevention activities of P&I Clubs and the levels of P&I insurance generally available to shipowners, including those whose vessels transit the Strait of Malacca.

Loss prevention is a core concern of P&I Club Boards and collectively the members of the International Group produce an extensive library of information designed to improve safety of ships.

Additionally, P&I Clubs’ boards view the provision of adequate levels of marine risk and supplemental war risk P&I insurance as essential to marine transport in the Strait of Malacca and world wide. At this time, IG P&I Clubs also offer Special War Risks P&I Cover (which includes terrorism risks) with a limit of USD 500 million above defined excess points. This Special War Risks P&I Cover relies on reinsurance
markets in which there are mechanisms for declarations of exclusion areas requiring additional premium. At this time no port adjacent to the Strait of Malacca and Singapore or the strait itself is a named exclusion area for the Special War Risks P&I Cover.

The IG continuously monitors the risks present and reinsurance available in order to provide shipowners with cost-effective insurance. The continued availability of reinsurance therefore influences the ability of IG P&I Clubs to provide the current level of terrorism coverage for ships transiting and calling at ports in the Strait of Malacca, and indeed anywhere else in the world. The International Group welcomes measures which improve safety and security in the Strait of Malacca. A significant
deterioration in security would ultimately be reflected in insurance conditions and costs.

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