Page 100: of Maritime Reporter Magazine (April 1993)

Ship Liability Premiums

To Remain Stable/ But

Deductibles Increase

A new policy between the 17 pro- tection & indemnity liability (P&I) clubs and reinsurers means that shipowners will not see an increase in their marine liability premiums this year, but a rise in deductible has increased the club's exposure by 67 percent.

Under the new agreement, own- ers will face $25 million in liability before the reinsures are required to cover their losses, compared to $15 million under the present deduct- ible.

According to sources, P&I club executives are relieved that they will continue to be paying last year's price of $350 million for the same maximum reinsurance limits of slightly over $1 billion.

There had been speculation that pollution-liability coverage would be discontinued or severely limited be- cause of the recent publicity sur- rounding the Braer and Maersk

Navigator tanker oil spills.

The purpose of the P&I clubs is to pool the resources of their shipowning members in order to provide marine liability coverage.

The clubs then buy reinsurance as a group to assist them in funding ship- owner claims. The reinsurers help the P&I clubs to pay a maximum of $700 million per incident for pollu- tion damage caused by oil spills.

MarAd Buys Tanker

From Falcon Carriers

For International Resale

The U.S. Maritime Administra- tion (MarAd) recently purchased the tanker Falcon Countess for $1.4 million at a judiciary auction in

Singapore with the intention of sell- ing the vessel on the international ship market. The auction was the result of a judicial arrest of the 20- year-old vessel initiated by MarAd itself when its owner declared bank- ruptcy in 1992.

The U.S. Government was deeply involved in the financing of the seven

U.S.-flag ships, four tankers and three dry bulk carriers, that were idled as a result of the folding of

Falcon Carriers.

MarAd has already purchased the three dry bulk ships—the Pride of

Texas, Spirit of Texas and Star of

Texas—and is offering them for sale to U.S. citizens or U.S. companies who will agree to maintain them under the U.S. flag. By selling the ships, MarAd hopes to recover some of the $45 million it paid to cover the bad debt on the vessels.

The agency intends to eventually purchase and sell all four Falcon tankers, but has no immediate plans to formally foreclose on the three remaining tank vessels.

American Pacific's Halotron I

Gets Good Evaluation

From U.S. Navy

Las Vegas-based American Pa- cific Corp. announced that the U.S.

Navy released a report based on tests comparing the company's

Halotron I fire suppression product and halon 1211.

Halotron I is intended as a re- placement for the ozone-depleting halon 1211, used extensively in fire fighting systems by the military and commercially around the world.

The Navy's conclusion reportedly confirmed that Halotron I is a viable alternative to halon 1211 in certain streaming applications.

Conducted at the U.S. Marine

Corps Air Station in Beaufort, S.C., the evaluation consisted of a series of events intended to simulate air- craft-related fires commonly encoun- tered by flight line and firefighting personnel, on which halon 1211 is routinely employed. The purpose of the evaluation was to compare the effectiveness of Halotron I to that of halon 1211.

The comparison was based upon the average volume of material used and time to extinguish each fire.

The report stated that while the tests show halon 1211 to be more effective fire suppressant, Halotron

I is "suitable for combating aircraft fires."

The report further pointed out that the type and number of existing fire extinguishers historically used in fighting fires with halon 1211 "would remain unchanged with the use of Halotron I."

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