Insurance for Arctic sailings

By Helle Hammer, Managing Director of Cefor and Chair of the IUMI Policy Forum

With the opening up of the high Arctic sea routes, marine underwriters will increasingly be asked to assess risk and provide cover for Polar sailings. IUMI, through the Policy Forum, has been actively involved in discussions surrounding Arctic transits and has recently published a position paper which can be downloaded from the website.

Risk assessment for underwriting purposes is inherently difficult for Polar transits. A lack of historical data coupled with the remoteness and harsh conditions means that cover is currently being written on a case-by-case basis. IUMI is calling for the surrounding infrastructure to be strengthened, particularly the provision of search & rescue capacity and suitable places of refuge. These factors, together with expected weather conditions, experience of the crew and the performance of the vessel itself should all be considered when assessing risk. The position paper provides a list of issues that underwriters might consider.

Arctic sailings are governed by the International Code for Ships Operating in Polar Waters (Polar Code) which sets out a range of issues that must be complied with or considered. Central to the Code is a mandatory Polar Ship Certificate that is awarded once a vessel’s operational limitations and its ability to mitigate incidents has been assessed. The Code insists that all vessels must carry a Polar Water Operational Manual to support the onboard decision making processes. These documents are important to the risk assessment, but since the Polar Code is goal-based more guidance is needed.

The International Chamber of Shipping (ICS) together with the Oil Companies International Maritime Forum (OCIMF) will (in 2019) be publishing guidance on how to achieve the goals set out in the Code. Class societies are also developing guidance.

In terms of Polar operations, going forward IUMI:

·         Supports the implementation of the Polar Code through further guidance, requirements and performance standards.

·         Supports the urgent consideration for an instrument to address non-SOLAS vessels operating in polar waters.

·         Strongly encourages an improved infrastructure in Arctic waters to provide necessary rescue capacity and places of refuge.

·         Encourages more surveys to produce increasingly reliable charts.

·         Participates in the Arctic Shipping Best Practice Information Forum responsible for an information web portal to support implementation of the Polar Code.