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.