March 1, 2024
Pictured: a breaking wave. Photo credit: Photoholgic.

Bigger ships and bigger waves equal bigger insurance claims

By Shipping Australia

Bigger ships and bigger waves make container losses more likely on box ships, new research by industry P&I (Protection & Indemnity) Club, Gard, has revealed.

The six-year average claims frequency for container stack collapses for feeder vessels (less than 3,000 TEU) is 1% over  a five-year period, Gard found, and that figure rises to 9% for vessels greater than 15,000 TEU. Containerships that call in Australia are nearly always less than 8,000 TEU and are often under 3,000 TEU. Containers exported from Australia are normally carried on smaller vessels to a trans-shipment port such as Singapore or Port Klang (Malaysia) and are then re-positioned onto bigger vessels; the converse is true of vessels imported into Australia.

After noting the correlation between bigger ships and claims, Gard then focused upon the effects of waves.

Big waves appear to cause sudden stack collapses

Gard noted a curious phenomenon when examining the seven days before a stack collapse. By Day 1 (of the 7 day period) vessels are experiencing 2.5 metre high waves, the weather progressively worsens so that, by Day 7 (the seventh day of the seven-day pre collapse period; i.e. the day upon which the collapse happens) vessels were being exposed to 6.5m high waves. Gard noted that many vessels were exposed to adverse conditions for a long time and that the stack collapse happened in a 24-hour window on the last day. It appears from the average maximum wave height vs time graph, that, from about 120 hours in (i.e. 5-days into the seven day period) the height of the average maximum wave rose from about 4.0m to about 6.5 in just over 24 hours.

It was also noted that the share of vessels being exposed to such heavy weather also increased by almost 12 times from Day 1 to 7. Gard suggested that the vessels may not have been able to avoid heavy weather in spite of advance weather routing tools.

Gard noted an interesting phenomenon in that the incidents did not always happen when the wave height was highest but after the weather started to subside. Gard suggested that might be partly due to the fact that the time of reporting the incident to Gard may not coincide with the time of the incident itself.

Bigger waves equal higher risks

Although ships only spent about five per cent of their time in wave heights of more than seven metres, half of all incidents happened during that time. “The relatively small percentage spent in adverse conditions significantly amplifies the risk of incidents, potentially up to 20 times higher,” Gard reckons.

Roughly 3.4% of the global container fleet is exposed to such weather at any given time but that the 8,000 TEU to 12,000 TEU category ship appears to have a greater exposure to 7m+ waves compared to other categories.

Different operators have different risks

It is also clear that the identity of who is operating the ships is a risk factor; some container ship operators are more exposed to the risk of adverse weather than others.

“This discrepancy likely stems from differences in operators’ risk tolerance and the internally defined weather thresholds for the vessels. However, the consequences of decisions made in the chartering or the operator’s desk are quite evident in the safety of the vessel and the cargo,” Gard noted.

Reflections on risk

Gard then raised numerous points for reflection. Namely – are there conflicting priorities between the parties (e.g. crew and the operating company) on weather thresholds? Do seafarers have suitable tools – i.e. tools that are not too subjective (e.g. “avoid adverse weather”)  or overly-complicated (e.g. by suggesting different calculations for different ship rolling risks). Is there a progressive deterioration in lashing as the constant motion of a vessel in heavy seas can exert loads on the container stacks, leading to the potential loosening of lashings. That leads to the question of whether routing should be tightened for ships with deteriorated container sockets and lashing eyes.

There are a wide range of other factors too and Gard concluded with a strategic management question. Namely: should safe weather routing and the avoidance of adverse weather be included as components of internal key performance indicators?

“Given that most liner operators already have dedicated teams focusing on vessel routing for efficiency and scheduling purposes, expanding their focus to include the aforementioned aspects could enhance safety,” Gard concluded.

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