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432122Maritime Reporter & Engineering News Moving 30 barges at once takes the sure hand of a tugboat pilot who knows how to maneuver a flotilla through the twists and turns of the Mis-sissippi River. Lashed together, three across and 10 long, the barges cover more than twice the surface area of a modern aircraft carrier. Most would agree that the best river pi- lots are artisans, deeply skilled in meth-ods to meet the challenges of thatparticular job. Equally skilled, however, are the tugboat captains in a crowded ocean harbor, jockeying into port a ship that towers above them, dwarfing their own vessels and offering just as many challenges when it comes to maneuver- ability as the river barges. These widely disparate jobs are bothpart of the workboat world, the segment of the ocean marine industry that makes its living by pushing or towing other ves- sels, moving oil platforms, serving as ice- breakers and performing salvage operations. While the risks each of these businesses face are different, the ap- proach for determining the right insur- ance coverage for them is similar. When seeking insurance protection, thegoal for workboat owners or operators should be to find the most suitable cov- erage at a competitive price to protect their assets and their business viability. Start by seeking out an insurance agentwith ocean marine expertise who under- stands the quality of insurance companieswith long experience in the industry. A critical step beyond finding the right agent is to understand what an insurancecompany will be looking for before a new policy is issued. To get the most value for their insurance dollars, workboat owners and operators will want to put their best foot forward, manage their risks wisely and make sound insurance decisions. Four Aspects of Underwriting Workboats When an insurance company is consid- ering taking on a new account, its under- writers carefully review risks and exposures by assessing the business, which typically includes examining these four aspects:Hull. Much like someone considering the purchase of a used car who looksunder the hood, kicks the tires and testsmechanical components, the underwriterwill try to thoroughly understand thecharacteristics of each workboat. He will take note of a number of factors: How well is it maintained? Are the engine and other mechanical parts in good repair? Isthe safety equipment stowed on board where it should be, and is it adequate forthe vessel? Even the overall cleanliness and tidiness of the boat can be an indica-tor of how high the owner or operator has set the bar for taking care of his equip-ment. Crew . One indication of a crew?s suit- ability is having Coast Guard licenses and certificates that reflect training. Be- yond that, the underwriter wants to see signs that the crew is skilled and knowl- edgeable. This includes time in grade, fa- miliarity with the company?s vessels and business operations, and breadth of expe- rience beyond the current job. A crew member can have the right paperwork, but it is often the time on task that builds their level of expertise and experience ? and which can reduce the likelihood of errors that can lead to accidents or otherproblems. Operations. There are two sides to op- erations ? land and water ? and the un- derwriter will want to look at both. Shoreside, the business may have em- ployees operating vehicles, or the owner/operator may use outside vendors that open the door to contractual liability. There may be real estate and other prop-erty that should be secured, and otherbusiness practices that can lead to differ- ent liability exposures. On the water side, the underwriter wants to know about the type of business the workboat is involved in. Are the op- erations focused on pushing barges up a river, pulling ships into port, towing ocean-going vessels, or moving yachts from one location to another? Different businesses involve different risks that must be taken into account when consid- ering the type and level of coverage. Navigation area. Finally, what is the geographic area of operation? Does theworkboat operate in a short stretch of one particular river, or is it an ocean-going tug with a wide area of operation? There is a big difference between pulling a tan- dem tow across the North Pacific and moving a single barge up a small water- way. Risk Management PracticesEven after all of the ?hard? data has been gathered, there are still ?soft? nu- ances that an owner or operator can use to demonstrate the quality of their opera- tion.For example, while no one expects a business to be risk-free, a business that is open to improving its risk management practices ? such as increasing the level of safety training, or implementing bettermaintenance procedures ? can be a muchmore desirable customer than a business that has no interest in learning new ways or changing bad habits. By working closely with its agent, a business can identify ways to improve its risk analysis and get better value for its insurance pur- chase. Once an insurer understands all four as-pects of a workboat business, the insurer and agent can work together to create the right mix of coverage and liability limits. An agent who is well versed in the nu- ances of ocean marine insurance can helpmake sure the coverage is properly aligned with any shore side property and casualty insurance that is in place.It may sound complex, but in the end, the formula for making sure a company has the right insurance is straightforward. Deal with an agent who understands notonly the ocean marine business but also the key factors that are involved in an un- derwriting assessment. Insist on having an insurer that is experienced in ocean marine coverage and has a good track record of meeting the needs of ocean ma-rine businesses. And finally, be a cus- tomer that is involved in every step of the process, from having the best risk man- agement practices to making sound deci-sions about coverage and limits. INSURANCE UPDATE Underwriting Workboats Tugs Take on Different Jobs but Underwriting Elements Are the Same By Charlie Pugliese, OceanMarine Hull & LiabilitiesPractice Leader, Travelers Ocean Marine(Photo: Greg Trauthwein) MR#11 (18-25):MR Template 10/22/2012 4:10 PM Page 22