Constitutional Law

Insider thoughts on piracy and arming crews

Reader Diogenes emails (his original command having been blocked, for some reason, by the spam filter):

I work in the insurance industry as a large property underwriter and work closely with our marine underwriters. I understand that the issues with armed crew on merchant vessels are mainly with insurance premiums and crew pay. Current marine rating rules classify any armed merchant vessel as a warship and the hazard premiums increase. In addition, arming the crew incurs additional training costs and often an increase in pay for the increased "hazard". Thus for the shipping company, it's a matter of economics. It's less expensive for them to lay off the risks(hull, cargo and ransom) to the insurer and the insurer is a willing accomplice.

Insurers, while often slow learners, do in fact learn. As more shippers tire of the current situation and either arm their crews or take on private security personnel; such as the Italian cruise ship, insurers will note higher losses on the unarmed vessels and reduced losses on the armed ones. The grey hairs at Lloyds will rapidly revise their rating rules shortly thereafter.

As a sidebar, it's been reported that the Chief Steward from the Maersk Alabama has filed suit against Maersk Lines alleging that they created a hazardous work environment. His requested damages is only $75,000, so it appears that he's trying to force Maersk into providing arms for their crews.

Full post as published by Of Arms and the Law on April 30, 2009 (boomark / email).