Although the threat from the perils ships usually encounter at sea may have reduced in many cases due to an increasing number of vessels waiting at anchorage or being in lay-up, other risk challenges have replaced them, as a new report from Allianz Global Corporate & Specialty (AGCS) highlights.
“The increasing disruption and economic pressures caused by the pandemic also has serious risk management implications for the maritime community and insurers alike,” says Captain Rahul Khanna, Global Head of Marine Risk Consulting at AGCS.
Although ships remain active through the coronavirus outbreak, many vessels have been impacted, leading to a number lying idle. A vessel is considered to be on lay-up when it is taken out of service and is anchored at a fixed location for a considerable period of time without undertaking any commercial activities.
In a so-called warm lay-up, vessels still have crew on board and can be ready to return to sailing relatively quickly. In a cold lay-up, a skeleton crew is retained for tasks such as maintenance, but most systems are shut down. Reactivating the vessel can take time, requiring extensive testing to ensure it is safe, and can be expensive, costing up to millions of dollars in worst cases.
“An unplanned lay-up can result in a prolonged recommissioning exercise that can last for months, even requiring docking. Comprehensive plans including risk assessments covering storage and lay-up are crucial for ensuring the safety of vessel during the downtime and its subsequent return to service,” Khanna explains.
Ship-owners are encouraged to use guidance documents and checklists provided by classification societies when preparing this plan. The lay-up plan should present a clear picture of risks specific to the location and the type of vessel, such as exposure to storms.
For example, there have already been reports of a considerable number of large cruise ships being temporarily laid up around the US East Coast, with the onset of the hurricane season in the North Atlantic creating potential risks for these vessels if they can’t be moved out of harm’s way quickly.
Maintenance of main machinery and nautical equipment, fire-fighting arrangements and tug availability in a contingency should also be among the areas of focus in the plan.
If lay-up of vessels is not properly managed, including regular maintenance, problems can materialize when the ship is ready to sail again. Delays in the servicing and inspections of vessels and emergency equipment can result in any problems remaining undetected, while supply chain disruption means oils and consumables can take longer to arrive, which can result in machinery damage if incorrect alternatives are used.