A flaw in shipping’s insurance framework could be hindering the development of safer, more reliable technology.
Destructive testing is not common practice in shipping. With many millions of dollars invested, no-one wants to test a ship – nor even a propeller, shaft or engine - to breaking point. But do those responsible for improving shipping technology and safety take advantage of the lessons that can be learned when these things do happen?
Last week we reported on stern tube failures that seem to have been caused by design changes in response to energy efficiency regulations. Class society ABS is among those that have since changed their rules to address the issue. Although it is too early to say for certain, these measures seem to be slowing the rate of failures.
One reader raised an interesting point. He claimed that although faulty design is often the reason for these failures, equipment suppliers can avoid responsibility thanks to difficulties in insuring against inherent defects. The result is that some shipowners may choose to attribute a different cause to an incident so that they can make a claim. In this way, technology suppliers escape liability
They also lose a valuable opportunity to learn from their failures. The number of incidents linked to badly designed equipment can never be known. Nor will suppliers have to revisit those designs to make them safer and more reliable.
This could also be a reason for the prevalence of ‘human error’ in claim statistics reported by insurance companies. Much easier to say that your second engineer dropped a spanner on something and ask the insurer to pay up, than to prove faulty design and recover compensation from the supplier.
Nor is this the first time I have heard such a claim. Around three years ago a shipping software developer told me that the true reliability of marine engines may never be fully known. Why? Because some shipowners would rather make an easy false claim than engage a supplier in a costly chase.
An industry where lives are lost each year cannot afford to turn down the safety improvements that could be made by addressing the true causes of equipment failures. There is room for all sides to improve how these situations are handled: insurers can make it easier to indemnify against faulty design; if all failures are correctly reported equipment suppliers can investigate potential design failures and, where appropriate, take responsibility; shipowners can insist on pursuing genuine claims rather than the easiest option.
Software engineers have a rule when trialling new applications: test it ‘til it breaks. Then find out what went wrong and improve on your design. If my sources are correct, the insurance framework for ship technology is broken. I’d like your ideas on how it can be improved.
Whether you are a shipowner, a technology supplier or an insurance company, I ask for your help:
Contact me in absolute confidence via email at email@example.com