There are different ways to become a charterer. You may hire the ship for a certain period of time or you enter into contract of carriage to deliver your own goods to their destination. In both cases you become charterer and our insurance solutions are designed to cover your liabilities towards the ship and other third parties. And one should not forget that in this very litigious world you may be held liable without being liable, so charterers' liability underwriters should provide you with defense against unjustified claims too. To make it simple - charterers' liability is practically the same cover as P&I insurance for the shipowner, but extended to cover charterers' liability for damage to ship itself. Different underwriters will bargain that their insurance conditions are wider or somewhat better, but there three main exposures, which should be included in your contract:
- Liability in respect of hull, which covers liability for physical loss or damage to ship (e.g.. due to unsafe port or negligence of stevedores) as well as demurrage, delay, loss of use or similar consequential losses.
- Liability for cargo, which might be essential for time charterers or slot charterers, where your own cargo can cause damages to neighboring cargoes. This cover should always include liability for disposal of cargo and consequential losses.
- Protection & Indemnity: This is very much similar cover to what shipowners are buying and should include various liabilities, including, but not limited to death, injury and illness, collision liabilities, wreck removal, stowaways and refugees, quarantine, pollution and fines.
In addition underwriters are keen to provide additional covers, such as:
- (FD&D) defense - cover for legal costs connected to chartered vessel and not related to charterers' liability insurance;
- COLL - cargo owners' legal liability;
- Bunkers - cover for physical loss or damage to bunkers, which are owned by time charterer;
- War risks, which are including strikes and terrorism.