BOW WAVE 158

Dampened Expectations Edition

news and views on trade, insurance and risk

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(c)2002 WavyLine.com	Issue No 158 02 Dec 02
Published free of charge to Readers
Editor: Sam Ignarski
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In this issue:

1. Welcome
2. Quarterpoints Column: The Prestige
3. Terrorism & Insurance
4. CargoLaw featuring the Hanjin Pennsylvania
5. Great Lakes and Seaway Shipping Buffs--Apply Here
6. And Finally...

1. Welcome

Warm thanks to all the Readers who sent interesting pieces in this week. Like all publications we have a number of enthusiastic contributors, a few occasional contributors and a large, silent majority. If you are one of the quiet ones, please think of us from time to time if you have anything, amusing, well written timely or interesting. We have one of the largest readerships in the industry. Once it appears in Bow Wave, the word is out.

New Readers this week include:

Patrick Quirk, Director of Ports Planning, Queensland Transport Graham D. Mulligan,MD of International Infrastructure in Brisbane Victor Mainak Halder of Informa in Hong Kong
Captain John Watkinson, General Manager, Maritime Safety, Queensland Stephen Keenan, Superintendent Engineer of Sealion Shipping Ltd (UK) Roberto Bergami of Victoria University in Australia

News of Readers

Jerry Giroux the marketing eminence of the Maritime Canada, Eastern Marine and in recent years the Canada man for CNA has left the large insurance company and is setting up in business for himself. We will be hearing more of him, we are sure.

Contact him at:

subrogateway@rogers.com

Lawyer Alex Guillamont from Valencia used to work for the local P&I Correspondent in the port(Nimes Espana). Having spent a year studying English law in London with a grant from the British Council, he has just accepted a position within the Lawrence Graham Shipping Dept.

Contact him at:

tavarish@hotmail.com

The final quarter of 2002 is looking ugly for the marine insurance market. Where optimism once sat in the saddle since January, a slew of losses especially in October has dampened expectations of great gain. Some of the reasons why appear in this Issue. So it goes.

Enjoy.

2. Quarterpoints Column: The Prestige

Your Editor's column in Lloyd's List wondered where the industry's spokesmen were when they were needed:

Prestige in the News

I was in Melbourne during the days of the Prestige drama, attending the Ausintermodal Conference. I am not a particularly good traveller and as usual I struggled with the time shift and the jet lag. On such trips I have this tendency to nod off to the sounds of CNN or BBC World, coming to from time to time and hearing the latest bulletin or update before snoozing again.

So I did not see the banner headline in last Wednesday’s Lloyd’s List: Not Again. But I did see in a faraway place how the story of such a casualty develops in the international TV newsrooms and how, still, the story develops very fast, without much help or influence from the shipping industry. The first people who understand the ways of the medium are those who work closely with it, week in and week out. It is remarkable how quickly a workable statement can emerge from the Chancelleries of Europe. Leaders like Jacques Chirac know how to strike while an iron is hot and strike they do. In Brussels, the energy and transport commissioner Loyala de Palacio issued a something-must-be-done statement very soon in the story. The opportunity to bang on about Gibraltar proved too hard to resist for the Spanish Government which spent days trailing this red herring in the media, failing to understand how in the search for someone to blame, their citizens might conceivably join the rest of the world in wondering whether denying the stricken ship a port of refuge was that good an idea. Now hope rather rests with the laws of physics: if the ship’s cargo remains compacted on the cold floor of the sea, causing no further difficulties, those Spanish authorities who at present are the objects of so much international scorn may yet go down in the verdict of history as sage.

Very soon in the cycle of this event, the broadcasts began to mention the issue of single vs double hulls, presenting a table showing how many single hulled tankers there are still plying the oceans. Also remarkably quickly into the newsroom studios came the various spokesmen of the environmental organisations each explaining the scale of the event, before the scale has really developed. Within hours of the sinking of the Prestige , the CNN presenters were speculating in a surprisingly well informed way as to the compensation limits which were available under the ship’s insurances. The first talking head I knew or recognised during those days of waking up to news bulletins every few hours was this paper’s own David Osler who supplied facts and figures which supplied a shipping or industry perspective.

This time there was little mystery as to the cast of characters involved, although the absence of what this paper called "a classic-style shipowner" offends every human psychological requirement in the book. The average citizen along the coastline affected by the spill will no doubt acquire the levels of exasperation now owned by US government authorities in the face of the difficulties in the way of penetrating the corporate veil of tramp shipping. The issue of ownership transparency will not likely go away this winter of shipping.

The Prestige demonstrates that everyone in the industries concerned knows what to do in the event of a casualty. The tendency to duck or pass the blame is on the whole resisted these post Erika days. Those involved on the insurance side proceed to follow their well planned procedures. Response teams go into action. Port States state a position. Class takes a position. Inspection regimes are justified (or not). Within hours the essential who is who and what is what takes shape. A lot of hard work and planning has ensured that this is so.

And yet, in those crucial hours and days following the breaking up and sinking of the Prestige, the industry was not particularly visible in the great open spaces of international news. Or even at all. The specialist readers of Lloyd’s List could not complain. Each day in print and by way of regular updates on the internet version of the paper, the developments in the case were reported as they came in. But this is really not quite enough.

Forces of nature being what they are, and the works of man being what they are, the modern appetite for energy being what it is, it is as foreseeable as anything is foreseeable that double-hulled or not, ships will come to grief and spill their cargoes into the sea. A person able to speak with authority on the industry’s response to these infrequent casualties-- by reason of long standing function and accessibility to the international press-- still seems to figure on the wish list rather than in the breaking news.

3. Terrorism & Insurance

Mary Thomson of Koo and Partners in Hong Kong has kindly passed along this Alert to Clients message from Joshua Sternoff and Nicole Watson, entitled "Congress Passes Terrorism Insurance Legislation: President Bush Expected to Sign Early Next Week." (Bush has in fact signed--ed)

The Alert discusses the following:

The Act establishes a three-year program to share terrorist-related risk among the federal government, insurers and policyholders.

Participation for insurers as defined in the Act and coverage of terrorism insurance are mandatory, and the Alert discusses the details of implementation.

It is not letting any cat out of the bag to say that this piece of legislation caught much of the London insurance community on the hop. Having intelligent watchers in the major capitals of the world who anticipate trouble is not a luxury the bean counters can eschew--rather it is the essence of industry leadership and anticipation.
,
See the excellent briefing at:

http://www.paulhastings.com/ClientAlerts/Content/11-02%20Terrorism%20Insurance%20Legislation.htm

4. CargoLaw featuring the Hanjin Pennsylvania

The striking pictures of this shipboard fire-pyrotechnics and all-- are featured on the Countryman & McDaniel law firm's website under the heading "Thar She Blows". Already there is talk of a very large claim on the cargo market. Hanjin have had bad luck with big casualties. Back in the late 1980s the Hanjin Inchon sinking produced the largest loss of containers claim in the history of the industry. The Hanjin Pennsylvannia was bound for Europe, presumably pretty full with Christmas goodies.

http://www.cargolaw.com/2002nightmare_penn.html

5. Great Lakes and Seaway Shipping Buffs--Apply Here

Everything Readers may wish to know about the shipping industry in and to and from the Great Lakes may be found at this website, the enthusiasm behind which is so unreasonable it should be acclaimed. There is also a very strong links page. Highly Recommended.

http://www.boatnerd.com/

6. And Finally.....

From Gordon Elliot of CTC come these extracts from one of the BBC's great comedic hits in the UK this year, a series called The Office which is just a nightmarish vision of life at work. The words of wisdom are attributed to the boss man David Brent, a believably awful boss man:

What does a squirrel do in the summer? It buries nuts. Why? Cos then in winter time he's got something to eat and he won't die. So, collecting nuts in the summer is worthwhile work. Every task you do at work think, would a squirrel do that? Think squirrels. Think nuts.

A successful team is paramount, our office team mirrors the success of Arsenal football team, but with less foreigners.

Show me a good loser and I'll show you a LOSER!

If you can keep your head when all around you have lost theirs, then you probably haven't understood the seriousness of the situation.

You don't have to be mad to work here, in fact we ask you to complete a medical questionnaire to ensure that you are not.

If you treat the people around you with love and respect, they will never guess that you're trying to get them sacked.

If at first you don't succeed, remove all evidence you ever tried.

You have to be 100% behind someone, before you can stab them in the back.

If work was so good, the rich would have kept more of it for themselves.

Those of you who think you know everything are annoying to those of us who do.

If your boss is getting you down, look at him through the prongs of a fork and imagine him in jail.

There's no 'I' in 'team'. But then there's no 'I' in 'useless smug colleague', either. And there's four in 'platitude quoting idiot'. Go figure.

There may be no 'I' in team, but there's a 'ME' if you look hard enough.

Process and Procedure are the last hiding place of people without the wit and wisdom to do their job properly.

Accept that some days you are the pigeon, and some days you are the statue

Know your limitations and be content with them. Too much ambition results in promotion to a job you can't do.

Make good use of your cylindrical filing unit,the one you mainly keep under your desk.

Remember that age and treachery will always triumph over youth and ability.

Never do today that which will become someone else's responsibility tomorrow.

Quitters never win, winners never quit. But those who never win and never quit are idiots.

If you're gonna be late, then be late and not just 2 minutes - make it an hour and enjoy your breakfast.

Remember the 3 golden rules:
1. It was like that when I got here.
2. I didn't do it.
3. (To your Boss) I like your style.

The office is like an army, and I'm the field general. You're my foot soldiers and customer quality is the WAR !!!

Set out to leave the first vapour trail in the blue sky scenario.

Statistics are like a lamp-post to a drunken man - more for leaning on than illumination.

A problem shared is a problem halved, so is your problem really yours or just half of someone else's?

Is your work done? Are all pigs fed,watered and ready to fly?....

You don't have to be mad to work here, but you do have to be on time, well presented, a team player, customer service focused and sober!!

I thought I could see the light at the end of the tunnel, but it was just some b*stard with a torch, bringing me more work.

Avoid employing unlucky people - throw half of the pile of CVs in the bin without reading them.

Put the key of despair into the lock of apathy. Turn the knob of mediocrity slowly and open the gates of despondency - welcome to a day in the average office.

BOW WAVE is published each week to around 7550 Readers in the transport,insurance,shipping and finance industries.

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