Bangladesh Seeks $22.4m Insurance Claim After Missile Hits Ship In Ukraine

Bangladesh Shipping Corp has been seeking $22.4 million from the vessel insurer for a cargo ship that was hit by a missile in March. In the maritime sector, it is reportedly the first major insurance claim resulting from the ongoing conflict in Ukraine.

The shipping agency of UN informed last week that it would create a safe and secure maritime corridor for merchant vessels and crews stuck in the Sea of Azov and the Black Sea, even though sources from the shipping industry expect the progress to be incredibly slow. In recent times, projectiles have targeted four other vessels. Of these, one eventually sank.

Insurance premiums have risen by more than a hundred percent for voyages to the region from the time the war started. Insurers are closely monitoring for more claims that might increase costs even more.

A blast during the night of 2-3 March rocked a Bangladeshi vessel dubbed Banglar Samriddhi and killed one of its crew members. The vessel had been stranded at the port of Olvia since 24 February after Ukraine stopped all operations due to Russia’s invasion.

Ukraine accused Russia’s military of targeting port facilities in a missile strike, whereas the Russian embassy in Dhaka mentioned that the circumstances were apparently “being established”. Russia, thus, denied targeting merchant vessels or civilians.

Since then, BSC, the vessel’s owner, introduced a claim with the vessel insurer on abandoning the vessel.

Dhaka’s Sadharan Bima Corporation was the provider of the war risk cover. It was reinsured via Tysers, brokers of Lloyd’s of London, a source from Sadharan Bima Corporation mentioned. The source also mentioned that the organization’s exposure was 10 percent with Tysers.

Commodore Suman Mahmud Sabbir, the managing director of BSC, told Reuters in a separate meeting that it would take time for processing the claim.

The deputy head of Ukraine’s Maritime Administration, Viktor Vyshnov, informed Reuters that the vessel was anchored at the port with no crew members on board. The remaining 28 seamen were evacuated and sent back to Bangladesh.

Vyshnov has agreed that the vessel’s bridge was impaired when the missile hit even though it is not established if the engine has been damaged.

Ships typically boast an P&I insurance, which has third-party liability claims, including environmental damages and injuries. Separate machinery and hull policies cover vessels against sorts of physical damages. This is besides war risk cover.

The last war-risk vessel casualty revolved around the Japanese-owned oil products tanker dubbed the Mercer Street. The vessel was damaged by a probable drone attack off Oman, taking the lives of two crew members in July 2021.

Between 1980 and 2020, lesser than 10 vessels of more than 100 gross tons were losses in attacks, per data analysis results shared by well-known insurer Allianz Global Corporate & Specialty.

Reference: ndtv.com