Rena losses likely to hit $150m

The Rena is insured by the Swedish Club, one of 13 marine mutual societies which form the International Group of P&I (Protection & Indemnity) Clubs. Members are shipowners that protect themselves from potential losses amounting to billions in cases where a ship damages another ship or when fuel or chemicals leak. Environmental damage is also insured as well as the ship itself and the cargo. About 90% of worldwide seagoing vessels are insured by the P&I clubs, Mr Fölsch said. The insured sums per loss event is limited to $1bn. "In the history of seafaring there has never been a case which reached this amount," Mr Fölsch said. Nevertheless, the Rena accident is one of the outstanding losses in recent years, he added. "There have been accidents with higher sums like tanker Exxon Valdez 23 years ago, or the recent offshore accidents, but for a cargo ship with dry cargo this is an event which does not happen every year." By comparison, the environmental clean-up after the damage caused by the Exxon Valdez cost oil company Exxon $5bn. The Rena was involved in an accident in October 2011 and broke apart in a stormy sea last weekend. Since October, about 360 tons of fuel oil drained into the sea. Some of the fuel was washed ashore on the north eastern coast of New Zealand. About 2,000 seabirds died as a result. Although fuel from the Rena has been pumped out of its tanks, it is expected that some more oil will leak out, because the ship is breaking up in heavy seas.hideThe company is led by Chief Executive Officer Alan Rickett, who was previously a Senior Vice President at Marsh. "Northcourt is a timely response to the shortage of capacity in the traditional global nuclear insurance market, for too long dominated by nuclear pools and mutuals," said Mr Rickett. "Amid burgeoning investment in nuclear energy worldwide there is a growing demand for a new approach to insurance which is aligned with the global nature of the industry today. There is limited insurer choice for nuclear companies and many have expressed growing concern over the existing market's ability to cope with an increased demand for limits and scope of cover." Amlin is the lead insurer for Northcourt and has a proven track record of underwriting nuclear risk. Marsh and Guy Carpenter were also involved in the creation of Northcourt. Marsh will provide accounting and administrative services in Malta and Guy Carpenter will manage Northcourt's insurance market placements. Duncan Dale, Head of Property & Casualty for Amlin London, said: "As nuclear technologies develop and new markets open across the world, so do the contingent risks of this industry. Amlin and the insurer panel seek to enable this development through flexible risk coverage and are pleased to have supported Northcourt in bringing a long-overdue new approach to the market." Mark Popplewell, International Nuclear Practice Leader from Marsh, said: "The growth of nuclear energy cannot be underestimated. Over 60 new nuclear reactors are currently being built globally, with in excess of 400 in the pipeline. Nuclear power is regarded by many as the solution to the world's energy problems. Due to the limitations of the existing nuclear insurance arrangements, clients have often in the past struggled to get competitive insurance protection. As the nuclear sector matures and the nuclear renaissance continues to gather momentum, Northcourt offers an exciting source of alternative capital."

Rena losses likely to hit $150m

Want to read this article?

Read Next

No evidence of major supply chain shift from China

Over 50% of exporters considering moving supply chains due to geopolitical risk

New carbon capture and storage insurance product from Aon

Nordics come top in global cyber security poll

EU strengthens CO2 emission standards for heavy-duty vehicles

No evidence of major supply chain shift from China

Over 50% of exporters considering moving supply chains due to geopolitical risk

New carbon capture and storage insurance product from Aon

Nordics come top in global cyber security poll

EU strengthens CO2 emission standards for heavy-duty vehicles

Want to read this article?

Read Next

No evidence of major supply chain shift from China

Over 50% of exporters considering moving supply chains due to geopolitical risk

New carbon capture and storage insurance product from Aon

Nordics come top in global cyber security poll

EU strengthens CO2 emission standards for heavy-duty vehicles

Related Articles