ASEAN Shipowners Push For Region's First P&I Insurance Club
By Nur Atiq Maisarah Suhaimi
MANILA, July 31 (Bernama) -- The Federation of ASEAN Shipowners' Associations (FASA) is working to establish ASEAN’s first Protection and Indemnity (P&I) insurance club to help regional shipowners reduce insurance costs and share risks amid rising premiums and growing challenges facing the shipping industry.
FASA chairman Mohamed Safwan Othman, who is also chairman of the Malaysia Shipowners' Association, said the initiative, currently in the structuring phase, was expected to take at least three years to complete.
He said most ASEAN shipowners currently obtained their P&I insurance from Western insurers, particularly those based in Europe, and that securing consensus among the regional shipowners was crucial before the initiative could move forward.
He said P&I insurance was compulsory for all vessels and mainly covered seafarers and cargo on board, while Hull and Machinery (H&M) insurance covered physical damage to a vessel's structure, machinery and equipment.
“We are talking to shipowners in the ASEAN region because a P&I Club is about sharing the insurance risk together and making sure that the premium became low, and we can cover whatever losses our members may incur.
“So that's what we have been doing for the past few years, talking to our members and hopefully creating our own P&I Club for the ASEAN region,” he told Bernama on the sidelines of the 10th ASEAN Media Forum here on Thursday.
FASA is a federation of national shipowners’ associations from ASEAN member states that promotes regional cooperation on shipping policy and maritime issues, supports efforts to improve shipping services, and represents members' collective interests in regional and international forums.
Mohamed Safwan said the conflict in West Asia had significantly affected shipowners through higher insurance costs, longer delivery times and increased operational risks.
Some insurers had withdrawn war-risk coverage while others continued to provide such coverage at substantially higher premiums, he said.
“In terms of that, we as shipowners and ship operators still continue to carry goods to make sure food security and energy security remain of the utmost importance for our countries.
“But at the end of the day, we need to make sure the risks are properly calculated and minimised because the safety of our seafarers and cargo is of the utmost importance to shipowners and ship operators,” he said.
Citing the latest International Maritime Organisation (IMO) data, he said about 2,000 Southeast Asian seafarers remained stranded aboard about 500 vessels in the Strait of Hormuz following the conflict in West Asia, with Filipinos accounting for about half of those affected.
He said the actual number could be higher as some vessels had switched off their tracking systems to avoid detection while transiting the area.
Providing some respite, Mohamed Safwan added that “quite a number” of seafarers had been successfully repatriated from the area over the past few months.
He said ASEAN regularly shared navigational and safety guidance with shipowners operating in high-risk waters through the Information Fusion Centre under the Regional Cooperation Agreement on Combating Piracy and Armed Robbery against Ships in Asia (ReCAAP), as well as through cooperation with the United Kingdom and the United States.
The two-day forum, organised by the ASEAN Secretariat with support from the German government through GIZ, brought together journalists, media leaders and policymakers from all 11 member states to exchange ideas, strengthen collaboration and promote greater public understanding of ASEAN.
-- BERNAMA
