Why the Longshore Act Still Matters: A Century of Protection for Maritime Workers

For insurance agents working with marine businesses, understanding the Longshore and Harbor Workers’ Compensation Act (LHWCA) is essential. This federal law has shaped the protection of thousands of waterfront workers for more than 100 years, and it continues to evolve today. But how did we get here?

From Legal Gap to Lifesaver: The Birth of the Longshore Act

In 1917, a Supreme Court decision (Southern Pacific Co. v. Jensen) ruled that states couldn’t provide workers’ compensation for injuries that occurred on navigable waters. That left a dangerous gap in coverage—until the Longshore Act was passed in 1927. The Act created a federal system to protect shipbuilders, harbor workers, and longshoremen.

Key Amendments That Changed the Game

Major updates in 1972 expanded coverage beyond vessels and docks to include adjacent areas, such as piers and marine terminals. Survivor benefits and maximum compensation rates were also improved.

In 1984, additional changes clarified who was (and wasn’t) covered. Recreational vessel workers under 65 feet, certain office personnel, and aquaculture workers were excluded if state comp laws protected them.

Adapting to a Changing Industry

In the 2000s, the Act was updated again to reflect shifts in maritime work. The 2009 American Recovery and Reinvestment Act expanded exclusions for recreational vessel repairers, after 10 years of lobbying led by the Marine Industries of South Florida. The 2009 expansion was then amended by rules published by the Office of Workers' Compensation Programs, released late in 2011. Then, in 2023, proposed regulations targeted employer penalties for failing to accurately report injuries—showing how the law continues to evolve in response to workplace realities.

Key Extensions of the Act

The reach of the LHWCA goes far beyond traditional longshore and harbor workers. Congress has extended its provisions to several other groups, adding layers of complexity to who’s actually covered:

• Defense Base Act (DBA): Covers civilian employees of U.S. government contractors working overseas.
• Outer Continental Shelf Lands Act (OCSLA): Covers workers involved in offshore exploration and development of natural resources—like oil rig crews.
• Nonappropriated Fund Instrumentalities Act (NAFIA): Applies to civilian employees of military-run services, such as base exchanges and recreational facilities.

Understanding who is covered is just as important as what is covered. Between special extensions, evolving definitions, and overlapping jurisdictions, navigating Longshore coverage isn’t always straightforward—especially for agents trying to do it alone.

For agents, the Longshore Act’s ongoing evolution means one thing ... 

Risks change, and so should coverage strategies. Whether your client is a marine contractor, terminal operator, or recreational vessel builder, the rules surrounding Longshore coverage can affect their exposure—and your liability.

Need help navigating it all? 

LIG Marine Managers has been specializing in Longshore for over 30 years. We’ll help you identify potential coverage gaps and find the best solution for your client’s needs.

Have a Longshore risk to review?

Send submissions to Submit@LIGMarine.com or visit LIGMarine.com to connect with one of our Longshore experts.

Related Blogs

Longshore Reform 2009
AIA Praises Reintroduction of Longshore and Harbor Workers Act Changes
Recreational Vessel Regulations Published
Longshore Rule Changes Deadline

A New Wave: The ECO Liberty Ushers in Hybrid Offshore Wind Support

Edison Chouest Offshore has launched the first U.S.-built plug-in hybrid vessel designed to support offshore wind operations. ECO Liberty is the first Jones Act–compliant plug-in hybrid Service Operations Vessel (SOV) in the U.S. offshore wind sector.

This innovation marks a pivotal step in the transition toward cleaner, more efficient maritime operations. The vessel can operate using traditional diesel power or switch to battery-electric mode, reducing emissions while improving fuel efficiency. As the offshore wind sector grows, technology like this is set to play a key role in balancing environmental responsibility with the heavy demands of marine operations.

For marine businesses, these advancements are more than just headline news—they signal a shift in the risks and exposures that operators face. New propulsion systems, alternative fuels, and hybrid technologies all bring unique considerations in terms of crew training, maintenance, and liability. From an insurance perspective, it’s vital to anticipate these changes so businesses can remain fully protected as the industry adopts greener technology.

As innovation transforms the marine industry, our 35+ years of expertise in commercial marine and Longshore coverage ensure you and your clients are always a step ahead. The experts at LIG Marine Managers specialize in identifying potential gaps and building customized insurance solutions that evolve with the industry. Whether it’s protecting offshore contractors, vessel operators, or marine employees, we deliver the knowledge and support agents need to provide their clients with peace of mind.

Ready to talk about how these changes could impact your clients?
Reach out to us today, and let our team shop the market and find the right coverages for your clients.

The Cost of Rushing: How One Small Oversight Led to Serious Injury

In the rush to get a vessel underway, small details can have major consequences. A recent incident involving a bulk carrier and a pilot attempting to board serves as a stark reminder.

Working quickly to get the vessel underway on schedule, the crew prematurely disconnected the gangway, removing the safety netting, and unintentionally leaving a dangerous gap between the accommodation ladder and the pier. When the pilot arrived, he found the gap too large to cross safely. Focused on final departure preparations, the crew did not respond to his communication attempts. Frustrated after several failed attempts, the pilot tried to climb onto the ladder himself but lost his footing and fell into the water, suffering broken ribs, a back injury, and deep bruises. Fortunately, his life jacket kept him afloat until emergency responders arrived. However, the incident delayed the vessel’s departure by 48 hours and left the pilot unable to work for months. Had the pilot hit his head or been crushed between the ship and the pier, this could have been a fatal accident.

This situation highlights the critical need for comprehensive marine insurance. Whether it’s Longshore coverage for injured workers, Maritime Employers' Liability (MEL) for crew exposure, or Protection & Indemnity (P&I) for liability risks, the right insurance ensures that businesses are protected from financial fallout when accidents occur. A single injury like this can lead to costly medical expenses, lost wages, and legal claims — expenses that could cripple an uninsured operation.

Investing in proper risk management and insurance coverage isn’t just about compliance; it’s about safeguarding your business, your crew, and everyone who steps aboard.

If you have questions about your marine client’s coverage needs, contact our expert Longshore team at Ask@LIGMarine.com. 

Mark Greenway

Rising Premiums and Shifting Risks: Key Insights from the 2024 IUMI Stats Report

The 2024 International Union of Marine Insurance (IUMI) "Stats Report" paints a promising picture of the global marine insurance market, with total premiums in 2023 hitting $38.9 billion—a 5.9% increase over the previous year. This growth cuts across all major lines, driven by strong global trade and rising vessel values. High oil prices have also spurred activity in the offshore energy sector. While this growth reflects a resilient market, it signals that we operate in an increasingly complex environment where adaptability and forward-thinking strategies are paramount.

Ocean hull insurance saw a notable rise, with premiums climbing by 7.6% to $9.2 billion. More activity on the water, an influx of new vessels, and increasing asset values have played key roles here. But with growth comes challenges; market capacity has been tighter, and inflation has started to push up repair costs, causing some deterioration in loss ratios. Fires on large vessels continue to be a concern as well. 

The cargo insurance segment also experienced solid growth, with premiums rising to $22.1 billion—a 6.2% uptick from the previous year. Loss ratios are the best since 2017, showing that our industry is making real progress in managing the risks of transporting goods.

Finally, the offshore energy sector reported $4.6 billion in premiums, a 4.6% rise tied to the rally in oil prices. While increased activity has yet to translate to a spike in claims, it's important to note that claims in this sector can take years to develop fully. 

Stability today doesn't mean we're off the hook for tomorrow's potential challenges. Looking ahead, marine insurance professionals must navigate complex challenges. Geopolitical tensions, severe weather events, and the push toward greener practices, to name a few. 

For marine insurance professionals, these insights underscore the importance of staying informed about industry trends and challenges. Engaging with organizations like LIG Marine Managers and participating in educational seminars like CMIP can provide valuable knowledge and networking opportunities. By proactively addressing emerging risks and adapting to market dynamics, agents and underwriters can better serve their clients and contribute to the resilience of the marine insurance sector.

Mark Greenway

Why is Longshore Coverage Important for Marinas?

Section 902(3)(C) of the LHWCA states that “individuals employed by a marina and who are not engaged in construction, replacement, or expansion of such marina” are excluded from coverage.

This exclusion may lead agents and marina operators to believe that Longshore coverage isn't beneficial for their marina operations, but that's not necessarily true. 

At the very minimum, marinas need Longshore coverage on an “IF ANY” basis so they're covered in the following situations:

➡ If marina employees ever do construction, replacement, or expansion work, they fall into an exception to the “marina” exclusion and, as such, would become Longshore.

➡ When contractors come to the marina to work on the docks, jetties, storage buildings, racks, etc., they are Longshore. If their employer does not have Longshore coverage in force, that can pass directly back to the marina.

➡ In situations with vessel service/repair work, the marina exclusion only applies to employees directly employed by the marina. If a contractor/subcontractor comes into the marina and works on a commercial vessel (sea tow, city/state vessel, most charter boats, etc.), they can claim Longshore even though direct employees doing the same work cannot.
Learn more about it in the What is a Recreational Vessel? webinar.

➡ Any marina employee can bring a Longshore claim, and even if they are unsuccessful in getting those benefits, marina operators could incur a significant defense cost bill. No Longshore coverage = No defense costs.

Fortunately for most marinas, the additional premium cost to add “IF ANY” Longshore coverage is a few hundred dollars — a small price to pay for peace of mind and protection in these situations. 

If you have questions about your marina client’s coverage needs, contact our expert Longshore team at Ask@LIGMarine.com. 

 
Ian Greenway

Keep your choice-of-law clauses – Supreme Court comes back with unanimous decision on: Great Lakes Insurance SE v Raiders Retreat Realty Co., LLC

Background of the Case

The dispute arose from a maritime insurance contract between Raiders Retreat Realty, a Pennsylvania-based company, and Great Lakes Insurance, headquartered in the United Kingdom. The insurance policy, which covered a boat owned by Raiders that later ran aground, included a choice-of-law provision designating New York law for any future disputes. When a claim was denied by Great Lakes, citing a breach of contract by Raiders, a legal battle ensued over which state's law should apply; Pennsylvania, where the lawsuit was filed, or New York, as specified in the contract.

The Ruling

The opinion of the Court underscored the primacy of federal maritime law in governing such disputes. The ruling unequivocally supports the presumption that choice-of-law provisions in maritime contracts are enforceable, offering clarity and predictability for parties involved in maritime commerce. This decision emphasizes the importance of respecting contractual agreements regarding jurisdictional law, thereby reinforcing the sanctity of contract law in maritime disputes.

Insurance Implications

As vessels tend to move about, the idea of determining appropriate jurisdictions would be difficult and costly in some cases. Allowing the clause to stand is going to remove a potential topic of debate when tough claims come in.

As of recent, we have found a general movement in the marketplace to a neutral choice-of-law state as opposed to variation as the home state of the insured.  This is likely to continue, and with insurers paying more attention to the topic, it might be an area of negotiation going forward.  Those negotiations would necessarily include at least considering the potential for which if any of the exceptions would apply to any decision made.

 

Narrow Exceptions to the Rule

1. Contravention of a Controlling Federal Statute
(see Knott v. Botany Mills, 179 U.S. 69, 77 (1900))

If applying the law chosen by the parties would contravene a controlling federal statute, the choice-of-law provision cannot be enforced. This means that even if a contract selects a particular jurisdiction's law, that choice cannot lead to outcomes explicitly forbidden by federal law.

2. Conflict with Established Federal Maritime Policy
(see The Kensington, 183 U.S. 263, 269–271 (1902))

The choice of law must also not conflict with established federal maritime policies. Federal maritime law aims to provide (and sometimes actually provides) uniformity and predictability across the nation's navigable waters. If enforcing a choice-of-law provision would undermine these fundamental goals—such as exempting a party from liability for negligence in a manner that federal maritime law prohibits—then the provision may not be enforceable. This exception aligns with the judiciary's role in maintaining a coherent and consistent maritime legal framework supporting national and international interests in maritime commerce. 

3. Absence of a Reasonable Basis for the Chosen Law
(see Cf. Carnival Cruise, 499 U. S., at 594–595; The Bremen, 407 U. S., at 10, 16–17.)

This exception is designed to prevent the arbitrary selection of a legal jurisdiction with no substantive connection to the parties or the contract. The rationale behind this exception is to ensure fairness and to avoid situations where the choice of law would significantly disadvantage one party over another without a legitimate reason. While the Court emphasizes deference to the parties' agreement, selecting a jurisdiction's law purely for its perceived advantages, without any rational connection to the dispute, could lead to unenforceability.

 

This post aims to provide a comprehensive overview of the Supreme Court's decision and its implications for the insurance industry. As always, parties involved in maritime contracts should consult with legal experts to fully understand how this ruling may impact their operations and legal strategies.

LHWCA Carriers' Right to Offset Despite Subrogation Waiver

The United States District Court for the Eastern District of Louisiana delivered an intriguing ruling in the matter of  Aries Marine Corp. The decision by Judge Lance Africk focused on the complex intersection of subrogation and offset rights within the framework of the Longshore and Harbor Workers' Compensation Act (LHWCA). 

The court's verdict stipulated that a waiver of subrogation by an LHWCA carrier does not negate the carrier's right to claim an offset against future LHWCA liability. This legal intricacy arose from an accident involving a lift boat off the coast of Louisiana in the Gulf of Mexico.

Workers injured when the lift boat capsized received compensation under the LHWCA, and the carriers then sought subrogation claims to recover the benefits paid from the defendants. However, the defendants and plaintiffs contested this by invoking the waiver of subrogation clause in their contract.

Judge Africk delved into the complex nuances of the contract, ultimately concluding that the waiver applied to the owner of the rig and its "invitees." Here, the court applied Louisiana law, defining invitees as individuals who enter premises with the express or implied invitation of the occupant, usually for mutual benefit.

The carriers subsequently filed motions for reconsideration, and the court recognized that a dismissal of their claim for an offset would be a "legal error." As a result, Judge Africk amended the summary judgment to acknowledge the carriers' right to claim an offset pursuant to Section 33(f). 

This ruling underscores the importance of understanding the nuanced aspects of legal provisions, even in cases where subrogation is waived, and reaffirms that carriers can still seek an offset against future LHWCA liability, ensuring a balance of rights in complex maritime compensation cases.

Ian Greenway