Tuesday, July 17, 2018

YOU Are Invited!

Posted By Karen Tischler, CMIP Education Events

Hey All Insurance Professionals!
Just wanted to invite you to our upcoming education event, the CMIP Insuring Marine Employees Seminar!  The seminar will be held October 9-10, 2018 at the Hyatt Grand in Seattle, WA.

The Insuring Marine Employees seminar delves deep into the exposures specific to Longshore and Workers Compensation, the regulations that define them, and where there are cross-overs that can cause unexpected exposures.  You will also receive practical “how to” guides on properly insuring them. 

Topics include an in-depth overview of Marine Employees Exposures with analysis of the State Act Workers Compensation, Longshore & Harbor Workers Compensation Act, Outer Continental Shelf Lands Act, and Admiralty Liability to Employees; Insurance Policies & Programs will focus on Workers Compensation, Longshore and OCSLA, Maritime Employers Liability, and Protection and Indemnity; and it concludes with the tricky issues of Payroll Allocation, Officer & Owner Exclusions, Modifiers, Auditing Techniques, and the Typical Structure Review.  Now that’s a lot of business knowledge packed into two days!

This dynamic seminar event is a great opportunity to broadening your expertise and network with others in your industry, as insurance professionals from all levels, Agents, Underwriters, Human Resources, Administrative, and Management will be in attendance!

Visit IIMIS.org to register; don’t delay as Group Rates fill fast and Early Bird Registration ends soon!  We look forward to welcoming you at this education event!  See you there!

Your event hostess, Karen Tischler

Tuesday, February 6, 2018

Do you have enough limit on your Luxury Yacht Policies?

An unnamed woman, who was sexually assaulted on a luxury yacht docked in Fort Lauderdale, was awarded nearly $70.6 million in damages after she sued the yacht’s owner.

The incident took place on board the Endless Summer, a 130-foot vessel, registered in the Marshall Islands, that was docked in Fort Lauderdale, on Feb. 25, 2015.

The woman worked as a stewardess for the company that owned the yacht, Island Girl Ltd.

Rafael Dowgwillowicz-Nowicki was charged with sexual battery.  In addition to the charge, the woman reported he entered her cabin drunk and threatened to kill her. He pleaded guilty in December 2016 and served a two-year sentence. By then he had already served most of his sentence. He was later deported.

The lawsuit alleged that Island Girl Ltd failed to provide proper security for the victim. The victim, the captain, and Dowgwillowicz-Nowicki were required to stay on board the Endless Summer overnight.  According to the lawsuit, the victim was not issued a walkie-talkie to alert anyone on board that something was wrong.

“She was screaming for her life at the top of her lungs,” said her lawyer, “…for over an hour before she escaped and got the captain’s attention.”

The jury awarded the woman $70,000 in lost wages, $4.2 million in lost future earnings and $66 million for pain and suffering. She was also awarded $290,050 in past and future medical expenses.

Monday, January 29, 2018

Is a Worker on an Island Longshore?

One of the most common questions we receive in our office is:

“Is a worker who works in a non-maritime job on an island and commutes by any form of boat eligible for Longshore benefits?”

First, we have to give the standard disclaimer that we are not attorneys, so what I am about to offer is not a legal opinion but an “insurance” opinion and that it assumes that the location is in “navigable” waters, i.e. not on a landlocked lake wholly within a single state (see the Longshore situs video if you need more information on that).

The first part of the answer has nothing to do with Longshore.  Any employees who operate a vessel, be it a 16ft. skiff, a 50ft ferry or acts as a crewman will typically leapfrog over Longshore straight into Jones Act and the other admiralty coverages and will require coverage in the form of Maritime Employers Liability (MEL) or the crew coverage provided by a Protection & Indemnity (P&I) policy, dependent on the details of the operation.

But, if the employee does not operate the vessel or act as a crewman, the good news is that I have never seen employees who simply “rides” the vessel as a passenger ever be held as either Longshore or Jones Act/Admiralty.  But, there are Two big HOWEVERS coming up here.

·                     If they load product or supplies aboard the vessel, they would be “loading or unloading” the vessel and thus Longshore.
·                     If they help catch a line or tie up the boat, they could be Longshore.

Even if they do neither of those, that does not stop a smart attorney from filing a Longshore claim, and no Longshore coverage also equals no Longshore defense.  Even if the employer wins, it can still cost them well into 6 figures to win in federal court.

It is unlikely an injured employee will bring an Admiralty or Longshore claim for a minor injury, but it will come from the major carrier end, probably soft tissue injury.   You should be able to add Longshore on an “If Anybasis or allocate a small amount of payroll for a small cost. Therefore, allowing you to obtain Longshore coverage and also an unlimited defense cost policy.  This not only protects the client properly but also provides the agent/broker with vital E&O protection.

The vessel P&I policy should also be extended to cover the liability for any employees aboard, including the crew if not already covered, or a MEL policy purchased again to provide necessary defense and E&O protection.

For more information on MEL policies and what they cover see 
MEL Myth or Mystery? and Protection & Indemnity.

Tuesday, January 2, 2018

P&I Club preparing for Brexit

The North Protection & Indemnity Club is preparing for post-Brexit possible fallout by creating a European Union subsidiary in Dublin, according to their press release at the end of November. 

The North fear that Britain may lose access to the EU single market after Brexit. As a result, they and many other British-based insurers, are making contingency plans in case they lose "passporting rights" that allow U.K. financial service firms to trade in Europe without the need for locally-regulated entities.

The North is one of the first to announce the location for an EU subsidiary and it is expected to start implementing its contingency plans in the first quarter of 2018, according to their release.

The firm said that due to "regulatory uncertainty and a realistic prospect," passporting rights could be lost as early as March 2019 upon the current two-year Article 50 expiration. Therefore, its board agreed that a subsidiary insurance company should be established in Ireland.

“The decision to locate the subsidiary in Ireland follows an extensive horizon-scanning exercise during which a number of possible locations were considered,” said The North. They cited the regulatory, legal and taxation framework, a mature regulatory system, a strong talent pool, easy travel connections and lack of language barriers as the motivation for their choice of Dublin.

Monday, October 23, 2017

Injuries sustained in suicide attempt can be compensable under Longshore

A federal appeals court ruled a man who shot himself due to anguish over injuries suffered on the job is entitled to compensation for the injuries he sustained during his suicide attempt.

William Kealoha was a ship laborer for Hawaii-based Leeward Marine Inc. when he fell between 25 and 50 feet from a barge to a dry dock   He suffered blunt trauma to his head, chest and abdomen, along with a fractured rib and shoulder blade, and knee and back pain. 

2 years later he shot himself in the head, causing severe head injuries, in a suicide attempt that he claimed was a result of his fall and litigation over that claim. A psychiatrist who testified on his behalf said Mr. Kealoha suffered from major depressive disorder due to multiple traumas and chronic pain from the fall and stress from the litigation, which caused depression, anger and anxiety, and worsened his already poor impulse control.  Mr. Kealoha sought workers comp benefits for the injuries he sustained during his suicide attempt.

In an unpublished decision issued by the 9th U.S. Circuit Court of Appeals in San Francisco., a three-judge panel of the appeals court ruled that the board correctly affirmed the administrative law judge’s decision to award benefits to Mr. Kealoha and denied the motion to review, saying recovery under the Longshore Act is appropriate.

Wednesday, January 18, 2017

Caribbean Vessel Insurance

Approximately 90% of the world’s Protection & Indemnity insurance premium is written by the P&I Mutuals, or “Clubs” as they are known and most of those have a common anniversary date of 20th February.   So, we are heading rapidly towards that date in 2017.

Whilst there is no requirement for their “sister” Hull policies to have the same effective date, many follow either with the same Feb 20th date or with March 1st, so the market is in full swing right now.

The scary part of this market is how just one change of a number in a Hull policy wording can create a huge divergence in the event of a claim.  Hull policy forms are cloaked in mysterious form names: “CL280", “CL284" or the notorious “CL289".  These titles mean little to most ship owners and even to most insurance agents (except for a few specialist commercial marine agents) and yet their differences can be enormous.  Take for example the term “F.P.A.”, a very common marine insurance abbreviation, meaning "Free of Particular Average".  That cleared it right up, didn’t it???
 "F.P.A." simply translated means that the only time the insurance company is going to pay a claim is in the event of a total vessel loss.  “Particular Average” means a partial loss; “Free of” means it is not covered! So, that $500,000 loss due to a fire on your $1,000,000 ship is not covered! Shock!! Gasp!!  Find out up-front, exactly what is or is not covered.  Often, a few extra dollars of premium (and sometimes no extra cost) will bring you a lot more coverage, just for the asking!

Sometimes a subtle but critical variance in the name of an insurance company can make a huge difference when you push on the policy with a claim.   More terrifying is how frequently we find that the shipowner or their broker/agent only find this out when the claim happens, particularly in the Caribbean market.

In our report “The Critical Flaws in Shipowners Insurance”, we highlight not just these two, but 5 other business ending flaws in shipowners coverage, particularly targeting the more “mature” vessel that trades either in the Caribbean or between the US and the Caribbean.

With the beginning of the opening of Cuba, this becomes even more important as trading opportunities become available there.

Just go to www.LIGMarine.com/carib to download a free copy of this report.

Happy and Claim Free Sailing!

Tuesday, November 8, 2016

The Hidden News for Florida Longshore Employers

Florida Workers’ Compensation rates will rise by an average of 14.35% effective December 1st and the industry has covered the impact of that on the “dry” businesses in Florida.  But the news for Employers with Longshore exposure is buried in the detail of the new filing.


For risks that fall into the “non-traditional” Longshore world – e.g. a risk that does electrical work in a Longshore environment – there is some good news!  Even though the “DRY” or State Act rate may have gone up an average of 14.35%, the new Longshore load has been reduced from 1.20 to .92!  That means that instead of multiplying the state rate by 2.20 you now multiply it by 1.92.
The math on this is a little complex, but the bottom line is that the effective Longshore rate for those codes will DROP a hair… 0.2% -- not much, but DOWN not UP!


The average rate increase for the “traditional” Longshore classes is increasing 3% over the January 1, 2016 rates.   There is a long and even more complex explanation as to why these rates are increasing, but bottom line is the increase is a modest 3% rather than the 14.5% for their “dry” counterparts
Some of the more common classes and rate comparisons are:

2015 Rate
2016 Rate
% Difference
6006F – Marine Const.
6824F – Boat Building
6872F – Ship Repair
7317F – Stevedoring
8726F – Steamship Line

 These new rates will apply only on risks that are new or renewing after December 1, 2016. 
The bottom line is that whilst the “dry” business are going to be hit heavily with rate increases as the policies renew, the effect on Longshore business is going to be modest.

Keep Calm and Carry On; seems to be a good motto for this change in the marine world!