Proper Lay-up Arrangements Curb Insurance Claims

Against a background of rising claims costs, the UK P&I Club has issued guidelines to its owners about P&I cover for laid-up ships to help them prepare and maintain their vessels. The Club is keen to minimise claims for personal injury, wreck removal, pollution, anti-fouling, environmental contamination and damage to other vessels, underwater cables, beaches and reefs. Furthermore, the Club is concerned about collision risks during lay-up.

A full risk assessment should precede, covering site suitability, crew safety, vessel, machinery and environment. The guidelines, prepared with BMT Marine & Offshore Surveys, contain extensive checklists relating to the lay-up site; mooring arrangements; security, safety, protection and environment; preservation and maintenance; preparation procedures; and approval and inspection arrangements.

The guidelines make the essential distinction between a ‘hot’ lay-up, where seamen, i.e. those contractually employed by the owner and obliged to serve on the vessel, are present, and a ‘cold’ lay-up where they are absent. Risk changes when employees are on board as contract compensation amounts are now so high. A hot lay-up is characterised by a reduced crew, some working machinery and the prospect of quicker, less expensive activation. A cold lay-up is a longer term exercise with all systems shut down with minimum ongoing maintenance to prevent deterioration of hull structure and machinery.