Ship loss down by 45% in 10yrs as long-term decline in loss continues

Loss of ships at sea has continued to be on the downward trend as global losses stood at a total of 85 ships, counting from 2006 to year 2015 , says Allianz Global Corporate & Specialty SE’s (AGCS) fourth annual Safety and Shipping Review 2016, which analyses reported losses of ships that are over 100 gross tonnes.

AGCS report attributed the 45 percent decline in ship loss since 2006 to an increasingly robust safety environment and adherence to self-regulation. Although, the number of losses remained stable year-on-year, declining by just 3 percent compared with the previous year, 2015 was the safest year in shipping business in the last decade.

A breakdown further reveals that there were disparities in ship loss according to regions and vessel-type. In 2015, East and West African coasts saw losses of six ships bringing the tally of vessels lost between 2006 and 2015 to 94. This development was attributed to notable challenging shipping safety and security in the continent apparently due to historic underdevelopment of the maritime industry in Africa.

However, AGCS Africa expects an increase in losses as the industry acquires more ships in line with the African Union’s 2063 Agenda, which has prioritised the marine economy as a major contributor to growth of the continent.

Also, more than a quarter of all losses occurred in the South China, Indochina, Indonesia and Philippines region and it accounted for lost of 22 ships while losses increased year-on-year in the region, unlike other major regions in the globe.

In terms of vessel type, cargo and fishing vessels accounted for over 60 percent of ships lost globally, with cargo losses up for the first time in three years. The most common cause of total losses is foundering (sinking), accounting for almost 75 percent of losses, up 25 percent, and often caused by bad weather.

“The insurance industry will continue to play a key role in protecting and growing marine insurance risks on the continent,” says Mark Govender, AGCS Africa Technical Underwriting manager.

The report further states that cyber exposure, driven by Internet of Things (IoT), e-navigation and piracy, “mega ship” salvage issues, super-storms and increasing arctic casualties heighten risk environment.  “Piracy incidents were down in West and East Africa, while the risk remains high.”

“There were 2,687 reported shipping incidents (casualties including total losses) globally during 2015, down 4 percent. Activity is spread across all days of the week, although Thursday sees the most incidents and Saturday the fewest. The East Mediterranean and Black Sea remains the top incident hotspot.”

Also, three vessels share the accolade of being the most incident-prone- a roro vessel in the Great Lakes region; a hydrofoil in the East Mediterranean and Black Sea and a ferry in the British Isles with 19 incidents over the past decade.

UZOAMAKA ANAGOR-Ewuzie