Protecting against the modern-day pirates
21 July 2008
For the lucky ones, it remains the stuff of fairy tales. Swashbuckling brigands roaming the high seas, forcing enemies to walk the plank and searching for treasure chests filled with gold. But sadly, modern-day piracy is an altogether more brutal and grim affair, with reports suggesting that attacks on boats – particularly on the coasts of poorer nations – are on the rise.
The shores of Somalia have been heavily targeted by pirates in recent years, with numerous ships being hijacked and crews frequently abducted. Speaking to CNN, Cyrus Mody of the International Maritime Bureau said that the last 12 months had seen 26 ships attacked in the area with the majority of hijackings being resolved by ransom payments. With no functioning national government in Somalia since 1991, crime and violence are rife in the country - and its coastline.
In June, an agreement was reached by the UN Security Council in a bid to tackle the issue, which is having a huge impact on the war-torn east African nation whose people are already suffering from lack of food and increasing violence. The agreement allows for the deployment of war-ships into Somalia's territorial waters by other countries if their cargo is believed to be under threat from pirates. During the meeting, the Security Council heavily condemned the attacks, stating it was ‘gravely concerned’ by the issue as it was threatening the ‘prompt, safe and effective delivery of humanitarian aid to Somalia’. It added that the piracy attacks were also putting ‘the safety of commercial maritime routes and to international navigation’ at risk.
Groups including the United Nations International Maritime Organisation welcomed the agreement, with secretary general Efthimios Mitropoulos saying that co-operation among countries was crucial. This, he said, would help to guarantee attacks against ships on the Somali coast are ‘prevented and suppressed to the benefit of the Somali people’. Mr Mitropoulos added that it was also vital to protect ‘seafarers and passengers on ships sailing in the region, the shipping industry and international seaborne trade’.
Currently, Somalia's transitional government has no power to prohibit pirates or patrol its own waters and struggles to protect the 1,800 mile-long coast. Its shores are based near shipping routes connecting the Red Sea and the Indian Ocean and are, for many cargo ships, a crucial part of the journey.
Other countries too have suffered from a heightened number of attacks in recent years including Bangladesh, Yemen and Nigeria, but it seems that, as with Somalia, keeping the situation under control is proving difficult. Earlier this month, it was reported that officials in India had been making efforts towards reducing pirate attacks on the shores of Mumbai but that patrol boats had proven ineffective in capturing the armed robbers. According to expressindia.com, police have failed to arrest pirates three times in the last two months because their patrol boats are limited to speeds of 15 nautical miles per hour.
And it is not just those living in these targeted countries that have felt the brunt of attacks on vessels. Nick Gooding, Senior Marine Cargo underwriter at XL Insurance, said it is often the ship's crew that are most at risk from attackers who are ‘usually intent on purloining cash and crew's personal effects’. He added: "Cargo is not at high risk as the logistics of unloading at sea makes partial theft very difficult."
However, Mr Gooding did highlight that there were some situations in which cargo can be the centre of an attack, with armed robbers taking over the entire ship and then selling the goods illegally on shore. "The ship is renamed and becomes a so called phantom ship," he said.
So what can be done to protect the marine industry and the people who are at risk of being attacked? According to Mr Gooding, there are no particular conditions or restrictions of cover enforced by the marine insurance industry in relation to piracy risks but that ‘ship-owners who trade in the most exposed areas presumably work with the protection and indemnity clubs on risk mitigation for the safety of their crew’. He added: "Hull underwriters usually impose additional premiums for vessels making calls in the worst exposed areas such as Nigeria and Somalia, which is to cover increased risk from pirates."
As levels of piracy rise, so ship owners can expect insurance premiums to go up, with Ken Alston of risk specialist Marsh saying this was an eventuality to be ‘expected’. He added that the scale of the additional premium being charged at the moment is ‘unlikely to have an impact on the consumer’ but if the number of incidences increases, this may change. In May 2008, the Joint War Committee added the Gulf of Aden, located between Somalia and Yemen, to a list of places at high threat of hull war, strikes, terrorism and related perils. It is now comparable to the likes of Iraq in terms of insurance risk, according to the committee.
Last updated on 21 Jul 2008
