Port strike sparks concerns about insurance

Navigating marine insurance policies in the port strike

This labor stoppage is affecting a wide ecosystem of businesses related to maritime trade. Although the duration of the strike does not directly impact the coverage of marine insurance policies, insurers are particularly concerned about the accumulation of cargo at ports, which poses additional risks. According to the information disclosed by FreightWaves, Kaufmann highlights the importance of the Accumulation Clause in marine insurance policies, which can double the liability limit in situations where large quantities of goods are stranded in one place for extended periods.

Large transportation companies typically have more resources and logistical networks that allow them to find alternative routes for their shipments during such disruptions. This gives them a significant advantage over smaller companies, which may be forced to rely on intermediaries or logistics agents to manage the situation. Additionally, when shipments from several carriers are consolidated into a single container, the claims process for damages or losses becomes more complex, and adjusters must refer to the relevant transport documents to properly classify the losses and assign liabilities, potentially causing further delays in claim resolution.

Finally, when the ports become operational again, it is likely that foreign manufacturers will attempt to quickly send large volumes of products that have been held up during the strike. Insurers anticipate an increase in requests for higher limits on transportation policies, as companies seek to protect themselves against additional economic losses arising from this situation.