Navigating the Baltimore Bridge Crash: How Marine Insurance Shields Shipping Companies from Costly Blunders

The Baltimore bridge crash is a sad incident, but it is one of the biggest maritime insurance payouts ever. It will cause a substantial loss to an insurance company, potentially the biggest maritime insurance payout. It is not profitable for insurance companies, but as an insurer, it is very important for shipbuilding companies to insure their ships to avoid these types of losses.

In the case of the Baltimore Bridge crash, the colliding vessel was insured by The Chubb Corporation, an insurance company. Therefore, the insurance company will cover the cost of repairs to the bridge, any injury or death that occurred, and other liabilities according to the terms of the insurance. Marine insurance safeguards shipping companies against the liabilities that can arise because of any accident, cargo damage, and other damages that can occur. Its functions are like car insurance, just the difference is the risk associated with maritime operations.

In the case of the Baltimore crash case, the insurance might cover: -

1. Damage to bridge: - The cost of repairing and the damages are substantial, and marine insurance will cover the cost of repairing and will have to make sure the waterways are restored.
   

2. Cargo loss & damages: - Due to collisions, the cargo damage also has to be insured by the insurance. This is the basic feature of any marine insurance.

3. Salvage & wreck removal: - The ship sunk underwater has to be removed, and it is a very complex procedure that requires high cost. The insurance company will bear this cost.

4. Legal liabilities: - The shipping companies might face legal battles from bridge owners, affected people, or other environmental authorities. This might incur costs that the insurance company can insure under the terms and conditions of the deal.

The premium and other terms and conditions are determined by factors such as the size and type of vessel, its operational capacity and history, and the cargo it carries. Companies with a past accident or carrying high-risk cargo are charged higher premiums. Marine insurance is not just a financial assurance against risk; it also incentivizes safe practices. Companies with poor safety records need help with issues like obtaining marine insurance.

Therefore, marine insurance highlights the importance of marine insurance. Without proper cover, a shipping company might face a financial loss after a major accident.

Thank you.

Regards,

Tushar Bangar

Kautilya, IBS Mumbai.