Suez Canal: Ever Given insurance claims could exceed US$2bn

Suez Canal: Ever Given turned in right direction

French reinsurance company SCOR has said that Ever Given claims could amount to more than US$2 billion, while they believe it will take many years to settle the claims and the process will include much debate about who is liable, as the issue of responsibilities and applicable laws in global maritime world is complex.

The 20,124 TEU Ever Given is one of the largest containerships in the world. It became famous after its serious accident in the Suez Canal on March 23, 2021. 

The ultra-large containership entered the Suez Canal to make a crossing that would normally take anywhere between 11 and 16 hours. Instead, a sandstorm, poor visibility, strong south wind and some miscommunication led to the vessel grounding that blocked the busy canal for six days. 

The ship slipped from one side to the other, finally lodging sideways across the canal and blocking the route. 

“The big lesson is that some sand and wind can potentially cause a tragedy of global proportions. This demonstrates the fragility of our economic and social models,” chief underwriting officer, Marine and Energy, Reinsurance at SCOR, Sylvain Gauden, said.

In the Ever Given incident, matters are complicated by the fact that the parties involved, the shipowner, the charterer, the owners of the goods, and even the Suez Canal, have insurance policies originating from all over the world, according to SCOR.

While all seek to recover at least some of their losses, the claims include different types of damages and losses, such as physical damage to the Ever Given, loss of revenue on the part of the Suez Canal Authority, the cost of the salvage operations and business interruption for owners and charterers of the blocked vessels, loss of perishables and cargo delays, as well as damage to the canal itself.

“Understanding the consequences of such an event means taking a holistic view. Who are the stakeholders? Which insurance policies can respond? What is their exposure? How much is this going to cost? All branches of marine insurance are concerned, and the interests are multiple and sometimes divergent,” Gauden said.

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