More on RORO issues

As thousands take roll on, roll off (RORO) vessels during the summer season, either as vacationers or as regular daily commuters, it is important that they are made aware of the risks they are exposed to considering the overall conditions of the shipping industry.

More than half of the ROROs in operation are old, a good number of which are over 30 years old. Many of the vessels were imported second-hand with ages ranging from 20 years and more, and are no longer allowed to sail in the countries where they came from.

Worse, some were reconfigured, adding another deck to increase load capacity which definitely affects the seaworthiness of the vessels.

Need not be in constant fear

Our country is composed of many islands, and sea travel is a vital link to keep people and goods moving from one place to another. The overall economy, and in particular, our domestic and foreign tourism, is dependent on this mode of transport for sustaining growth.

Should thousands of daily RORO travelers live in constant fear?

Not if Transport Secretary Arthur Tugade and the Maritime Industry Authority (Marina) will heed the call of marine experts and the public in general for safer RORO travel, and urgently consider the following for implementation:

The first is to phase out RORO vessels that are more than 30 years old within a period of three years. During this interim period, however, all vessels that are 30 years old or older will only be allowed to operate on a temporary basis subject to stringent annual inspections. After this period, all ships 30 years old and older should be scrapped.

The second recommendation is to ban the importation of second-hand RORO vessels 20 years old and over.

The third recommendation is to enforce a ruling stipulating that all ROROs allowed to operate in Philippine seas must be fully classed, preferably by a member of the International Association of Classification Society (IACS). This will make RORO vessels eligible for more comprehensive insurance coverage.

Will DOTr Secretary Tugade and Marina officials finally act to make RORO travel safer before another disaster occurs?

Marine underwriter views on RORO

A reader with a long experience dealing with the shipping industry sent the following analysis of the RORO situation with a request to keep “my name off the radar.” Please read on:

“I have been a marine underwriter for more than 35 years, doing both cargo and hull [protection and indemnity] insurance. I have insured quite a number of local shipping lines. I was reading your columns lately about ROROs, and they sure are very accurate. Let me add a couple of things:

Strict supervision not in place

“RORO, being what it is, is not exactly the best mode to transport passengers and land vehicles, if strict supervision is not in place.

“Abroad, no land vehicles can be ‘rolled on’ unless they pass through a weighing scale to determine where the vehicles would be parked inside the hold. This is necessary to balance the weight of the vehicles across the deck in compliance with the loading plan and avoid shifting of weight to one side.

“Lashing (fastening of the vehicle to the deck) is a must to prevent any movement of the vehicle when the vessel is rolling or pitching. As far as I know, neither weighing nor lashing is strictly, if not regularly, implemented. I’m not sure if there is even a weighing scale to begin with.

Affecting seaworthiness

“You are absolutely correct that age and changing the design from its original configuration do affect the seaworthiness of the vessel. The question really is: how come the design is approved, and the certificate of seaworthiness and license to navigate are released?

“Years ago, certification of ISM compliance was required at least by a few insurers before insurance could be obtained. Which brings me to the next item.

“Insuring vessels is a great source of premium, hundreds of millions of premiums, especially for fleet accounts. For the uninitiated, it was easy to generate premiums to meet his budget by chasing ship owners interested in saving premiums and offering very competitive terms, terms that an experienced hull underwriter would never dare offer.

“The result? Claims were attended by loss adjusters (they are appointed and paid by the insurer), when the right thing to do is to have average adjusters (appointed by the ship owners) and hull surveyors (appointed by the hull insurer).

“Loss adjusters are not cut to assess hull losses and apply the provisions of the hull policy. They handle fire claims, motor OD and TPL, cargo, liability, etc., but not hull claims.

Ignoring need to modernize

“To date, I never understood why the authorities ignore the need to modernize the sea transport industry in the country. In aviation, airlines and even general aviation upgrade their fleet to attract and ensure the safety of passengers and cargo.

“Either they purchase new aircraft or lease from international aviation leasing companies. Sadly, I never had the chance to compare what incentives are enjoyed by local airlines that are not available to ship owners and the comparable regulations of both industries.

Is seaworthiness checked before sailing?

“If a casualty should occur, and the cause or origin of the casualty, e.g., damaged engine, rudder, fire hydrants, etc., is proven to be known to ship owners, the hull insurance will not respond.

“Hence, there are cases where the skipper does not inform ship owners (whether on his own volition or upon instruction by the ship owner) of any defect, damage, lack in crew or any matter that may affect the seaworthiness of the voyage.

“Seaworthiness is so important that a specific number of crew is required in the license to navigate, and any crew who is not on board makes the vessel not seaworthy, and the authority should not allow the vessel to sail. The question is, is this being implemented?

Keeping the business

“When a creditor bank blindly accepts a hull policy from a debtor/ship owner at inordinate terms and conditions and bargain premiums, both the creditor bank and debtor ship owner feel assured their interests are secure: the truth of the matter is, they are not.

“Only when a fairly large loss occurs [is] when realization of this nightmare comes to fore. When a controversial issue arises and the insurer is unable to explain the reason, the bank creditor at times twists the arm of the insurer to pay even if in truth the loss is not covered by the policy or the correct loss payable is smaller than what the bank creditor expects.

“So keeping the business, instead of doing what is right, is the order of the day. Not the accommodating the bank creditor’s desire is wrong, however, a respected hull insurer will be able to make it clear that the payment is a form of accommodation, not because the insurer is unable to explain why the loss is not payable or the amount payable is much less than what is expected.

“I hope this serves some purpose in your review of the RORO (and the shipping industry as a whole). Thanks and more power.”

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