Allianz warns on potential spike in accidents brought about coronavirus-inspired downturn

Insurer Allianz’s annual shipping review, published today, warns the consequences of coronavirus and a sustained economic downturn could threaten long-term safety improvement and trigger an uptick in losses from cost-cutting measures, fatigued crew, and idle vessels.

“We know from past downturns that crew and maintenance budgets are among the first areas that can be cut and this can impact the safe operations of vessels and machinery, potentially causing damage or breakdown, which in turn can lead to groundings or collisions. It is crucial that safety and maintenance standards are not impacted by any downturn,” said Captain Rahul Khanna, Allianz’s global head of marine risk consulting.

The annual study analyses reported shipping losses over 100 gt. Allianz data shows that in 2019 there were 41 total losses of vessels were reported around the world, down from 53, 12 months earlier. This represents an approximate 70% fall over 10 years.

The South China, Indochina, Indonesia and Philippines maritime region remains the top loss location with 12 vessels in 2019 and 228 vessels over the past decade — one in four of all losses. 

Issues with car carriers and roro vessels remain among the biggest safety issues. 

“The rise in number and severity of claims on roro vessels is concerning. Roros can be more exposed to fire and stability issues than other vessels,” said Khanna. “Many have quick turnarounds in port and a number of accident investigations have revealed that pre-sail away stability checks were either not carried out as required, or were based on inaccurate cargo information. Too many times commercial considerations have endangered vessels and crews and it is vital that this is addressed on shore and on board.”