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Thursday, February 11, 2010

the sad demise of a Ship ~ 'cruel manslaughter'

Ocean is deep and interesting and the nonchalance of ship endears one and all.

The sight of a very large vessel floating on water, carrying goods from one place to another offers imagination beyond dreams. Man has conquered the ocean sailing across with the aid of ships and boats which developed alongside mankind. Vessels have borne the key in history’s greatest explorations. The cargo - from slaves to modern day containers, dry and wet, live, frozen and refrigerated, big machineries, bulk cargo, liquid cargo – the variety is endless.

But just as most things have a shelf life, ships also have a limited span of life. The most interesting part of insurance – the Marine insurance offers infinite variety and offers coverage from cradle to grave. Depending upon the type of vessel and nature of goods carried, generally after 25-30 years ships are at the end of their sailing life. These vessels who have outlived its existence are sold and dismantled to recover the valuable steel. A very major % of the vessel consists of steel which can be rerolled besides valuable machinery such as generators, marine engines etc., There are various other miscellaneous material as well.

The birth of a vessel is more celebrated that the arrival of a kid. Ships are launched in big ceremonies and ceremonially named. The name of a ship class is most commonly the name of the first ship commissioned or built of its design. However, other systems can be used without confusion or conflict. In the United States Navy a class is always named after the lead ship, that is, the first ship of the class to be approved by the United States Congress. In European navies a class is named after the first ship commissioned regardless of when she was ordered or laid down.. Once built and ready, the transition from hard to water is by launching i.e., moving the vessel from point on dry land to a lower point in water. The oldest, most familiar, and most widely used is the end-on launch, in which the vessel slides, usually stern first, down an inclined slipway. The date the ship entered service is also incorrectly referred to by some as its launch date

The prefix of ship is a combination of letters, usually abbreviations, used in front of the name of a civilian or naval ship. Prefixes for civilian vessels may either identify the type of propulsion, such as "SS" for steamship, or purpose, such as "RV" for research vessel. . Civilian prefixes are often used inconsistently, and frequently not at all. Sometimes a slash is used to separate the letters, as in "M/S".

As the vessel ages and there is so much of wear and tear that refitting and repair becomes uneconomical, the vessel enters the scrap yard for demolition. Emotionally sad especially after the fanfare of launch. Every year hundreds of vessels are taken out of service and sold for scrapping. Asia has emerged as a big market for scrap. Ship breaking or ship demolition is a type of ship disposal involving the breaking up of ships for scrap recycling, with the hulls being discarded in ship graveyards.

In the initial stages, ship breaking was done in the docks of Europe, in a highly mechanized manner. May be when they became more conscious of environmental and physical hazards they posed, and due to spiralling costs, the asian market began to emerge. Now the Nations that have lesser environmental and safety standards are the havens for this activity. India, Bangladesh, China, Pakistan and Turkey are all thriving markets.

These coasts are littered with machinery parts, oil rags, leaking barrels, asbestos, toxins, organic pollutants and humans in inhuman living conditions. There is always the problem of residual gases and chemical wastes. In India most of the ships are beached at Alang, in Gujarat, on the West Coast of India. Alang is a Port in the town of Bhavnagar Dist in Gujarat. The breaking activities started in and around 1983 and have come a longway since. Though there is high number of labourers engaged, their payment is not always reasonable.

They continue to get large supertankers, car ferries, container ships, and many once specialised vessels. The activity is mostly manual as labourers struggle at their wits end. Their living conditions are much deplorable. Personally, I have seen some activity in the East coast – off the pleasant Kakinada – on the beaches near Vakalapudi & Uppada. May be it was around 1996 the first ship breaking occurred and invited much fanfare and lot of protests thereafter. There were fierce protests from various groups including fishermen and environmentalists.

The breaking unit was a small piece of land with a make shift office. The vessel would run on full stream and in high tide run on the shore at full blast. Obviously would get struck in the sands at some level and there sighed its final breath. From then it would be hammer and tongs and gas cutting.
The beached lifeless vessel would then be chained to the yard – cut into pieces by workers wielding axes and gas cutters. I have seen workers (mostly labourers from Orissa) virtually walking on the huge iron chains, carrying implements on shoulders marching to the ship – would look like small ants charging on a mammoth giant. Once cut the ship would present a pathetic sight. With reduced weight, the vessel would be hauled towards the shore by use of winches and the activity would go on – till a few days when it would get reduced to a rubble. Lot of material would come out of it – steel, generators, engines, maps, books, work of art, furniture, electrical items, wires, cables, ropes and some fancy items as well.

But to those who love sea and the sea creature – the ship, it would represent the death of an animate object which did so much for the humanity.

Some of the activity were to happen in Vallinokkam near Ramanathapuram but whether any vessels died there is not really known.

Besides pollution and other damage to the coast and marine life, the workers were also exposed to various health hazards.

From the Insurance perspective, this was a goldmine of opportunity for generation of premium – though experts maintained this to be very risky. Some held that there was so much of profit for the person breaking – the insured value could only be the purchase price and the party would realise huge profits by cutting and selling and thereby may not manipulate a claim. This remains a mystery ~~!!

The Marine Hull Tariff provided ways of covering this under two different sections. Sec V of the erstwhile Marine Hull Tariff provided for coverage of funeral voyages from a place in a Port to the breakup yard or vessels lying at sheltered places awaiting break up. The SI was to represent the actual purchase price + mark up + customs duty – with voyages on vessels own power and on tow being one of the criteria for rating. This was more of transit insurance and would cease upon beaching or starting up of breaking operations.

Sec 17 provided for Ship breaking insurance – insurance of vessels in the course of being broken up. Here the Sum insured was to be Full purchase price + customs duty + port charges + any other government levy. The period was not on voyage basis but was to be reckoned in period of full months, arrived at the basis of actual LDT of the vessel. The proposal was provide break up details in Metric tonnes & rate of Iron & steel, Non ferrous articles, Machinery including generators, main engine, panels etc., Spares, Timber & furniture, miscellaneous items which could include maps, books etc.,

The policy though issued in Hull Department was more or less Fire Policy ‘C’ cover providing coverage against Fire, Lightning, Explosion / Implosion, Impact damage, Aircraft damage, Riot, strike, malicious damage and additional cover against Earthquake, STFI perils etc.,

Hope you enjoyed this article. Look forward to your feedback.

With regards

S Sampathkumar.

1 comment:

  1. Sir, could you please write more about the insurance aspect of ship breaking.

    Thank You