Average main engine damage claim tops $500,000

Entitled “Main Engine Damage,” the report investigates more than 1,000 Hull and Machinery claims relating to over 5,400 vessel years of statistics.

“Main engine damage makes up nearly 35% of machinery claims costs,” says Lars Malm, Director, Strategic Business Development and Client Relationship for the Swedish Club. “It is the most expensive category of claim with an average cost of over half a million U.S. dollars per claim. Yet most engine damage, as with so many claims we see in many different areas of our business, remains related to incorrect repairs and maintenance. Numerous cases have been noted where damage occurs shortly after the engines have been overhauled by ship or shore staff.”

With an average cost per claim of $926,000, lubrication failure is still the most costly cause of damage to the main engine, due to consequential damage to expensive parts such as crankshafts etc.

“We are seeing crew with insufficient experience and training; experts not in attendance at major overhauls; contaminated lubrication oil and contaminated bunkers; and engine components not operated or overhauled as per management instructions,” says Mr Malm. “It is a catalog of errors which can only be remedied by the implementation of a proper management system, backed up by comprehensive audit and inspection.”

The report contains good news for the Korean shipbuilding industry: vessels built in Korea, which account for almost 31% of the Club’s entries, have contributed to only 12% of the total cost of main engine claims in the last three years.

Despite technical advances since the Swedish Club published its last report on this topic in 2011, vessels with low speed engines continue to incur proportionally fewer claims than those with medium and high speed engines, with 57% of club entries in this category responsible for only 40% of main engine claims cost.

You can download the full report HERE

Vital bridge equipment: Digital camera

 

The club points out that experts need clear images to provide early remote assistance with incidents and the immediate actions required, and that insurers need evidence of the alleged damage and the losses suffered.

Currently, says Mike Harrison of marine consultancy Solis Marine Consultants, Ltd., when dealing with many fixed object damage claims – broken fenders, concrete or pile damage, crane contact – experts or insurers often have little to go on, “perhaps a quick sketch, a few pixelated images and a remarkably large bill for repairs and loss of use.”

Writing in the latest issue of the London club’s StopLoss Bulletin, Mr. Harrison  says that in many cases, the immediate task of collecting and preserving evidence lies with the master and crew.

“Good photographs taken as soon as possible after the event are invaluable, and can easily be shared by email with a remote expert for instant advice on key issues,” he writes. “The expert can then identify where further detail might be useful, the signs of prior damage and perhaps dilapidation or poor design.”

“These days, $100 buys a camera capable of storing and taking quality images,” notes Mr. Harrison. “There is no need to compromise on quality or quantity.”

Mr. Harrison says that the bridge kit should include as a minimum:

“The camera should be kept on the bridge, fully charged with an empty storage card. Most cameras have an internal clock which should be checked and set to UTC. This time-stamp is used when the image file is stored, essential when the chronology of events could be questioned,” says Mr. Harrison.

Insurers still see too many navigational claims

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