Comprehensive Cover for Offshore Operations
Our comprehensive P&I cover protects our Members' third party liability for a range of situations including pollution, crew and other personal injury, collisions, cargo liabilities, dock/property damage and wreck removal.
As well as these standard third party liabilities, the Club also provides cover for some contractual liabilities and indemnities provided certain criteria are met in terms of the risks assumed by the Member. For this reason, the Club offers a complimentary contract review service to assist Members with understanding where gaps in cover might arise, and what can be done to amend contract terms to bring them within their existing cover.
Those operating in the offshore sector, however may be presented with risk exposures and liability regimes unique to the industry which fall outside of standard cover, either because of the nature of the operations, or because the liabilities and indemnities accepted under their contracts exceed that which is permitted by Club Rules.
In particular, of relevance to those operating in the offshore sector are the exclusions and modifications to cover that are found in Rule 5H of the Club Rules. Though not a complete list, the most relevant of these activities for an offshore shipowner to be aware of are set out in the table below, alongside the specific rules applicable for each activity for both Owners and Charterers:
|Activity||Owner Member||Charterer Member|
|Dredging, blasting, pile-driving, well-intervention, cable or pipe laying, construction, installation, maintenance work, core sampling, depositing of spoil, power generation, decommissioning or such other specialist operations as the Managers may decide (together referred to as "Specialist Operations")||Club Rules + Offshore/Specialist Operations Additional Cover (section 2)||Charterers Terms & Conditions + Offshore Additional Covers (section 1)|
|Operating submarines or underwater vessels or equipment, or carrying out professional or commercial diving operations||Club Rules + Offshore/Specialist Operations Additional Cover (section 3)||Charterers Terms & Conditions + Offshore Additional Covers (section 2)|
|Drilling operations in connection with oil or gas exploration or production||Offshore & Fixed Premium Terms and Conditions||
Bespoke cover available
Where the Member is undertaking any of the above activities, it is recommended that they consult with the Club immediately to discuss their insurance requirements.
Specialist and Underwater Operations
It should be noted that although some exclusions exist in relation to Specialist and Underwater Operations, cover for personnel liabilities, wreck removal of and pollution from the entered vessel will remain in place throughout the operations. In addition, where a Member is carrying out Specialist Operations, the Club is able to offer additional non-poolable cover which reinstates the P&I cover that is excluded due to the nature of the operations. This additional non-mutual cover is also available for those carrying out underwater operations.
For those carrying out drilling operations in connection with oil or gas exploration or production, the Club has specific Offshore and Fixed Premium Terms & Conditions. These are on a fixed premium basis and are specifically tailored for mobile offshore, storage and/or production units, and cover drilling rigs, FPSOs, FLNGs, FSUs and other similar units.
As set out above, the Club is able to cover, as standard, liabilities under indemnities and contracts where these are fault based or knock for knock and the Member preserves its right to limit at law. However, in the offshore sector, modern commercial realities, including the gradual erosion of the pure knock for knock regime, mean that it is often difficult for Members to strictly comply with these requirements, which results in their P&I cover being prejudiced. The Club, therefore, has in place additional covers, which respond to contractual liabilities and indemnities which would not otherwise be covered. The covers that we see taken most often by our offshore Members are:
Extended Contractual Liability Cover
Our Extended Contractual Liability cover responds to liabilities that the Member has been required to assume under its contract that exceed its liability at law. So, for example, where the Member takes responsibility for personal injury to or property damage of third parties, regardless of how that damage is caused, the Extended Contractual Liability Cover will respond. This cover also responds to contractual naming and waiving requirements, voluntary wreck removal liabilities and 'Borrowed Servant' claims.
Care, Custody & Control Cover
Our Care, Custody & Control cover responds to contractual liabilities incurred by the Member when property or personnel belonging to others is in the Member's care, custody or control. For example, we often see this when Members transport wind turbine parts offshore for installation, or when contractors' personnel are on board the vessel during the operations. In particular, this cover will respond to personal injury, death or illness of personnel, loss or damage to property and pollution emanating from property of persons other than the Member.
As well as the covers set out above, the Club is also able to offer a range of other products, as well as bespoke cover, to fit your requirements. Further details of these can be found on our dedicated Offshore & Energy page here. We look forward to speaking with you to discuss your insurance needs.
Offshore & Contracts Director
Senior Underwriting Director