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ICA DECLARES BUSHFIRES A CATASTROPHE IN NSW AND SE QUEENSLAND

By | News

ICA CEO Rob Whelan said more than 70 bushfires were still burning across southern QLD and NSW and the declaration gives priority to claims from affected policyholders.

The fires fanned by high winds have resulted in multiple property losses since September 5, with the focus today on the area around Stanthorpe close to the NSW /QLD border as well as locations in the Gold Coast hinterland. The extent of property loss is still to be determined, as is an estimate of the financial loss.

“Insurance companies are standing by to help their customers. I encourage anyone who has suffered property damage to contact their insurer as soon as possible to seek guidance on the claims process and the assistance they are entitled to under their policy,” Whelan said.

The Australian Financial Complaints Authority (AFCA) has activated its significant event response plan following the NSW and QLD bushfires being declared a catastrophe by the ICA.

The significant event response plan is activated for events that can potentially result in significant numbers of related complaints coming to AFCA. It provides for early communication with relevant stakeholders and a more streamlined, expedited process for the resolution of related complaints.

AFCA has encourage those who have been affected by the NSW and QLD bushfires to contact their insurance companies.

Under the declaration the ICA has:

  • Activated its disaster hotline – 1800 734 621 – to assist policyholders if they are uncertain of their insurance details, or have general inquiries about the claims process

·         Community members can also enquire via www.disasters.org.au

The ICA is making arrangements to represent the insurance industry at community meetings in affected areas. The meetings will provide property owners with important information about the insurance claim process.

 

CREDIT: INSURANCE & RISK 

Climate change-driven flood risk could make Townsville homes “uninsurable

By | Insurance, News

Homeowners and businesses in north Queensland may soon find it difficult to insure their properties as flood risk rises due to climate change, new modelling has suggested.

According to Climate Valuation, flood cover will become difficult to obtain and too expensive for Townsville and other north Queensland communities, as the risk to homes from flooding is expected to more than double under climate change.

Modelling revealed that flooding in Townsville is already about 20% more to likely to occur than previously thought, and that total flood risk in the region is likely to shoot up by 130% by the end of the century, putting the waterlogged region “on track to become uninsurable,” Guardian Australia reported.

“Unfortunately, there are a lot of properties out there that planners in years past considered acceptable, but which homeowners may find are not insurable today or won’t be very soon,” Karl Mallon, director of science and systems at Climate Valuation, told the publication. “Generally, insurance companies often draw a line in the sand at the frequency of a one-in-100-year flood event. This means that as the risks of flooding increase, many Townsville houses will be uninsurable, or the owners will find cover unaffordable.”

A number of homes and businesses that have been impacted by the recent catastrophic flooding in Townsville said they did not have specific flood cover. The properties rated by city planning codes to be outside the “one in 100 years” flood zone, meanwhile, were reported to be effectively flood-free.

“We strongly urge people to check with councils and insurers if their homes are in flood zones, and if they can expect long-term affordable cover,” Mallon told Guardian Australia. “If not, they should know they will have to plan for the risks on their own and think about adapting their homes for climate change.”

 

CREDIT: INSURANCE BUSINESS AUSTRALIA 

Townsville flood damage bill total revealed

By | News

The catastrophic floods that have inundated roughly 82,000 homes in Townsville over the past week have so far resulted in 6,525 claims, worth $80 million, according to the Insurance Council of Australia (ICA).

The damage bill is expected to soar over the next few days as policyholders return to their waterlogged homes.

ICA clarified what the flood crisis means for householders in terms of their insurance cover and responded to warnings from Townsville Mayor Jenny Hill that north Queenslanders would not accept unfair premium increases after the floods, AAP reported.

“Right now, we’re focused on fixing properties,” Campbell Fuller, ICA communications manager, told the news agency. “Any talk of premium rises is premature.”

Campbell said all insurers have had a standard definition for flood since 2012, which includes water escaping from a dam, including an intentional release.

“There may be a small percentage of policyholders who have decided to opt-out of flood cover at time of purchase or chose to buy a policy that excludes flood,” Campbell said. “Those policyholders may need to have their claims tested to determine if their claim meets the standard flood definition.”

ICA also expressed concerns that a significant number of Townsville commercial policyholders may not have taken up flood cover.

Hill urged insurance companies to “act as responsible corporate citizens” to help speed up the recovery effort, AAP reported.

CREDIT: Insurance Business Australia

New Unfair Contract Laws Explained

By | Insurance, Legal, News

Source: ‘Frankology’ Blog, By The Fold

The unfair contract laws* which start on 12 November 2016 will be a powerful tool for small businesses when negotiating contractual indemnities. Charmian Holmes explores why…

What is an unfair contract term?
An unfair contract term is a term which:
• causes significant unbalance to someone’s rights and obligations;
• would cause them detriment if it was relied on; and
• is not reasonably necessary to protect the legitimate interests of the party relying on it.

Until now, small business had no option but to sign an unfair contract – or miss out on the opportunity for that work.

Who’s protected?
There are 2 key criteria:
• you must be a small business (ie less than 20 employees); and
• (the upfront contract price must be <$300,000 (for contracts of 12 months or less) or <$1,000,000 (for contracts of > 12 months).

From 12 November 2016, small businesses can challenge any unfair contract term. The onus is on the big business (or government authority) to prove those terms are not unfair. If they are, the term is void and can’t be enforced against the small business.

This is a long awaited and hard won protection for small businesses which has the potential to significantly enhance their ability and willingness to provide services to big business. Let’s look at how it will apply to unbalanced indemnity clauses.

One-sided indemnity clauses
There are a number of ways in which indemnity clauses could be challenged as unfair contract terms – these include:
• Indemnities which transfer liability to the small business for losses or liability regardless of fault.
• Indemnities that require the small business to be liable for the other party’s negligence.
• Unlimited indemnities, eg where there is no financial limitation.
• Indemnities for consequential loss, or excessive liquidated damages.

What about contracting out of proportionate liability?
The proportionate liability laws enable contracting parties’ liabilities to be adjusted to the proportion to which they caused, or contributed to an event that caused a loss. Clauses which contract out of this and impede the small business’ ability to join the big business as a concurrent wrongdoer in litigation involving a third party are manifestly unfair!

This means that small businesses can challenge any indemnity clause that differs substantially from the smaller business’ liability in the absence of the contract. Especially if it would trigger a contractual liability exclusion in an insurance policy – as this would mean that the small business would

have no insurance coverage for the exposure.
Small businesses rarely have the financial resources to indemnify big business without recourse to their liability insurance. The irony in this situation is that the contract usually requires the small business to hold

those insurances for this very purpose.
Once the new laws commence, small businesses will have more ability to challenge these types of clauses as it will be illegal to include them in contracts with small businesses. This will reduce the current imbalance in negotiating power between small and large businesses and reduce exposure to uninsured losses.

What about contracts signed before 12 November 2016?
Big business can continue to use contracts with unfair terms until 12 November. If you feel like you’re being pressured to sign something now, this might be why!

If you sign a contract before 12 November 2016, it will be harder to challenge any unfair contract terms – but you should try.

If an existing contract continues after 12 November 2016, ask for changes now to redress the imbalance in the indemnity and other clauses. If that’s not possible, the new laws will only apply to the contract, when it is renewed, varied or extended after 12 November 2016.
.
*Treasury Legislation Amendment (Small Business and Unfair Contract Terms) Act 2015

Author: Charmian Holmes

Vandalism suspected as historic tall ship Defender sinks in Townsville

Vandalism Suspected as Historic Tall Ship Defender Sinks in Townsville

By | News

A 120-Year-Old Sailing Ship Has Sunk At Its Moorings In North Queensland.

People arriving to work in Townsville this morning were surprised to find the 35-metre tall ship Defender submerged at a wharf on Ross Creek in the city’s CBD.

The hull of the vessel was completely submerged, while its rigging remained above the water.

Maritime Safety Queensland has cordoned off the site.

Ship owner Les Dick, who is based in Tasmania, said it had been “gut wrenching” to hear the news this morning.

“We do suspect it’s been an act of vandalism or such leading to the sinking of the vessel,” Mr Dick said.

“We won’t know until we refloat the boat … but at the moment that’s what the people up there are saying.”

The Defender has been in Townsville for more than seven years after it was damaged in an engine room fire.

Mr Dick said he was going to travel to Townsville this week to inspect the damage.

“Our next attack will be to get some competent people around us and some pumps, sandbags, and at the low tide this week, when the deck’s exposed, we’ll simply pump the boat out and refloat it again,” he said.

“We hope it’s that simple … then it will be moved from that location to another.

“We’ve got a lot of support up there … so we’ll do whatever we can to save the old girl, but it’s heart wrenching that this [has] happened to a great old ship like that.”

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Defender The Last Ship Of Its Kind

The Defender was built in 1895 and used as a trading vessel between the colonies.

In 1923 the Defender entered the history books with a record-breaking crossing of Bass Strait, and in World War II it was used to transport troops and supplies.

Mr Dick bought the vessel in 1982, and it was restored to take part in the bicentenary re-enactment of the sailing of the First Fleet into Sydney Harbour in 1988, as well as the Bicentenary Tall Ships Race from Hobart to Sydney.

It was a charter boat in the Whitsundays for a number of years before it arrived in Townsville and fell into disrepair.

Mr Dick said the Defender was the last of the Bass Strait ketches.

“She’s the absolute last one. When she goes that’s the end of it all and that’s the end of an era,” he said.

“[It’s] a bloody beautiful boat, a beautiful boat and it was restored with a lot of love and care and a lot of Tasmanians helped, donated to get it going in 1988.

“I think it did Tasmania proud in the bicentenary and it’s been a representative for Tasmania wherever it’s gone in Australia.”

Mr Dick said the boat’s future looked grim.

“It’s been in the stage up there where I really should’ve moved it back to Tasmania, but things have stopped me from doing that,” he said.

“I’m in a state of confusion about the whole thing and I’m very upset about it. It will take me a day or two to settle down and get my mind around all this.

“The last thing we would want is for such an historic vessel to end up going to the tip. It would be an absolute tragedy.”

ABC North QLD – Tuesday 4th January 2016 – Article available here

Launch of Shipping Industry’s Cyber Security Guidelines

By | News

BIMCO has introduced guidelines to assist the global shipping industry prevent cyber security breaches onboard ships. These guidelines are the first of this nature for the shipping industry. These guidelines focus on detailing the cyber risks that may occur along with measures to prevent such risks. The guidelines also assist in how to deal with these risks should they unfortunately occur.

Download the Cyber Security Guidelines

*PRESS RELEASE*

4th January 2016

Cyber security guidelines for ships launched today.

BIMCO, together with other leading shipping organisations, has today launched a set of guidelines to help the global shipping industry prevent major safety, environmental and commercial issues that could result from a cyber incident onboard a ship.

The cyber guidelines launched today are a first for the shipping industry, developed by international shipping associations, comprising BIMCO, CLIA, ICS, INTERCARGO and INTERTANKO – and with support from a wide range of stakeholders. The Guidelines on Cyber Security Onboard Ships are free to download from the BIMCO website.

Angus Frew, Secretary General of BIMCO, said:

“BIMCO has led the way to identify potential cyber vulnerabilities for ships – and their implications – based on the latest expert research.”

“The aim is to provide the shipping industry with clear and comprehensive information on cyber security risks to ships enabling shipowners to take measures to protect against attacks and to deal with the eventuality of cyber incidents.”

Cyber threats are changing all the time – and BIMCO and the other industry associations will regularly update the cyber guidelines to ensure shipping companies have the latest information available.

Angus Frew added:

“The guidelines launched today should help companies take a risk-based approach to cyber security that is specific to their business and the ships they operate.”

ENDS

Further information can be found on the BIMCO website.

Oceanic Marine Risks

Ensuring a Safe Christmas on the Water

By | News, Uncategorized

The Christmas and New Year period is the perfect time to drag the boat out and hit the water to appreciate our beautiful sunny Queensland.

You certainly will not be the only boat owner to have this thought so please be mindful of all extra boats out on the water. Increased traffic means a higher number of incidents so we ask that you, your family and friends be extra cautious and alert this year.

Here are a few tips to help make your Christmas afloat a safe one:

  • Always ensure there is a charged mobile phone available
  • Have an EPIRB on-board if operating more than 2 nautical miles from land in open waters. Ensure this in date and registered.
  • If drinking, please ensure there is at least 1 designated driver onboard. Police periodically conduct random breath tests in our waters. The blood alcohol limits for recreational skippers is 0.05.
  • Always check the weather forecast before and during your trip. Be prepared for extreme conditions.

From everyone at Oceanic Marine Risks, we wish you all a wonderful festive season.

Enjoy your time on the water this Christmas!

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Hands Across the Blue for Prostate Cancer

By | News

On Saturday 29 August, just under 200 boats, united at the Shag Islet Cruising Yacht Club (SICYC) Rendezvous in Gloucester Passage to raise funds for the Prostate Cancer Foundation. Members who have come from around the country gathered in the
waters off Montes Reef Resort to form the spectacular ‘Hands Across the Blue’ in the shape of the Prostate Cancer of Australia
logo.

The aim is to increase awareness of the fatal cancer that takes so many Australians lives each year. Maria Dwyer & Lizzie Wickham from Oceanic Marine Risks presented the Shag Islet Cruising Yacht Club with a donation of $10,000, which assisted in the raising of $82,000 over the 3-day event.

Hands Across the Blue for Prostate Cancer
On Saturday 29 August, just under 200 boats, united at the Shag Islet Cruising Yacht Club (SICYC) Rendezvous in Gloucester Passage to raise funds for the Prostate Cancer Foundation. Members who have come from around the country gathered in the
waters off Montes Reef Resort to form the spectacular ‘Hands Across the Blue’ in the shape of the Prostate Cancer of Australia
logo. The aim is to increase awareness of the fatal cancer that takes so many Australians lives each year. Maria Dwyer & Lizzie Wickham from Oceanic Marine Risks presented the Shag Islet Cruising Yacht Club with a donation of $10,000, which assisted in the raising of $82,000 over the 3-day event.

SICYC News Picture (2)

700 members attended the event in a bid to raise money for the foundation with raffles, auctions and events taking place. Ken Thackeray, the founder of the SICYC said his goal is to spread the word throughout Australia and hopes that on the last Saturday of August each year other organizations will hold hands across the blue to raise the awareness of Prostate Cancer and the effect it has on many Australians and their families.

The Shag Islet Cruising Yacht club has over 4000 members worldwide with the crucial aim of raising much needed funds for the Prostate Foundation as well as creating a social network for the cruising yachties and members. Membership is $60, which includes the title of Vice Commodore in your specified area, SICYC polo shirt & membership card. To become a member of the SICYC visit www.sicyc.com.au

Cybercrime – Is it a threat to Australia’s marine industry?

By | Legal, News

pdf-screenshotThis article was published in Ausmarine Magazine, 2015.
Written by Maria Dwyer, of Oceanic Marine Risks.

In 2013, Australia established the Australian Cyber Security Centre and created a national cyber security strategy. Each year cyber crime costs Australian businesses $4.5 billion and yet many businesses still fail to recognise cyber crime as a threat to their operations.

It has become obvious that the consequences to a business as a result of security breaches can be dire. One only has to look at the consequences suffered by Target and Sony last year after their vast and complex computer systems were hacked into. Each year the frequency and severity of cyber attacks increases, and there is no reason to think that 2015 will be any different.

John Bruce, the chief executive of Co3 Systems, believes that cybercrime will continue to boom in 2015 and that we will see even more eager cyber criminals enter the profession. He argues that the reason for this is simple: cybercrime pays and the rewards heavily outweigh the risks.

This threat has two sides to it.

Businesses not only need to increase their computer system security levels and focus resources on prevention and detection, but businesses also need to consider what measures they must take to protect their customers from potential losses as a result of a system breach.

What has any of this got to do with the marine industry?

I recently came across a blog by Gilad Zahave, dated February 4, 2014. Gilad’s blog post was an excerpt from a report Cyber Threats to the Shipping Industry.

I realise that Australia’s shipping industry is very small and that the majority of commercial vessels in this country are either small passenger carrying vessels or brown water vessels. However, if the world’s shipping industry is under threat from cybercrime should we not take notice and start thinking about preventative measures at a domestic level?

We currently tend to think of cybercrime as resulting in identity theft, e-business interruption, copyright/trademark infringement, and lawsuits from customers but can cybercrime result in a casualty on a vessel at sea?

I do not have the identity of the author of the report Cyber Threats to the Shipping Industry itself. However, if you are interested in the full report please write to info@sensecy.com.

A section of the report deals with the vulnerability of the AIS system. Trend Micro, a security firm, had claimed it had uncovered major security breaches in the Automatic Identification System (AIS).

The AIS is an automatic tracking system for identifying and locating other vessels by transmitting electronic data with other nearby vessels, AIS base stations, and satellites. Information transmitted can include the position, the speed and the direction the vessel is heading in, among other things. The International Maritime Organisation (IMO) mandated AIS in all passenger and commercial vessels weighing in at over 300 tonnes.

In an experiment to test how secure the AIS was, Trend Micro researchers managed to break into the system and change the data being transmitted.

They did this by manipulating the Internet providers AIS was using to transmit information. They could modify vessel details like the position, the course, the cargo, the flag and the name of the vessel. It was also possible to create fake vessels that could show up in any location.

The researchers then used a basic transceiver to expose flaws in the AIS communication systems. They could send false distress signals, false weather information and even switch off the AIS entirely in a vessel.

These loopholes in the AIS could be used by hostile parties to alter data being transmitted in vessels, with the potential to cause dangerous safety risks, disrupt marine law enforcement, and sabotage rival economic activity. Terrorist organisations could even exploit this weakness as well, given little technical know-how is required.

In an article dated April 23, 2014, Jeremy Wagstaff states:

“In the maritime industry, the number of known cases is low as attacks often remain invisible to the company, or businesses don’t want to report them forfear of alarming investors, regulators or insurers, security experts say.

“There are few reports that hackers have compromised maritime cyber security. But researchers say they have discovered significant holes in the three key technologies sailors use to navigate: GPS, marine Automatic Identification System (AIS), and a system for viewing digital nautical charts called Electronic Chart Display and Information System (ECDIS).”

“While data on the extent of the maritime industry’s exposure to cyber crime is hard to come by, a study of the related energy sector by insurance brokers Willis this month found that the industry ‘may be sitting on an uninsured time bomb’.”

There are a number of discussion papers published on the global threat to the maritime industry – does this threat spill over to Australia’s domestic maritime industry?

 

Yangtze cruise ship disaster will cost insurers

By | Insurance, Legal, News

The fatal Yangtze cruise ship that capsized and killed more than 400 people last week will cost its insurers about $19.2 million, or 92.5 million yuan, Chinese insurance regulatory authorities disclosed.

The four-deck cruiser, christened the Eastern Star, was hit by a freak tornado on the Yangtze River on June 1. The vessel overturned in about a minute only a few dozen meters from the riverbank, leaving an estimated 442 dead or missing, mostly between the ages of 50 and 80. Just 14 people – including the ship’s captain and first engineer – survived.

China has assembled a 60-member team to investigate the incident, which marks of one of the country’s worst shipping disasters in nearly 70 years.

For insurance companies covering the ship and cruise line, the tragedy will mean a sizable payout. According to a conference held by the China Insurance Regulatory Commission Thursday, insurance companies underwrote 340 contracts for parties involved in the incident that live up to requirements for claims. That includes shipowners, travel agencies, passengers and crew members.

The ship itself, which was owned by the Chongqing Eastern Shipping Corporation, was insured for about 15.7 million yuan by the People’s Insurance Company of China.

The CIRC also included estimates for 12 million yuan of liability insurance for travel agencies, 61.7 million yuan of personal insurance for 396 passengers and 3.12 million yuan of personal insurance for 18 crew members.

Already, the People’s Insurance Company of China has paid 10 million yuan to Chongqing Eastern Shipping Corp.

Despite the scale of the tragedy and timing – the news comes one year after the sinking of a ferry in South Korea that killed 304 people on board, including teenagers on a school trip – the incident is not expected to have much impact on the insurance market or the risk profile for cruise ships.

Affected Chinese insurance carriers rushed to the site of the disaster as divers searched for missing people.

“We have set up emergency leadership groups, rapidly implemented emergency response measures and set small teams who have already rushed to the site,” PICC told Reuters.

Ping An Insurance Group Co. of China and China Life Insurance Co. also sent in emergency response teams and had claims teams on-site to work with clients.  Ping An said it has already identified multiple life insurance customers on board the cruise ship and have contacted family members to cover travel and accommodation costs.

Published 15.06.2015 – www.insurancebusinessonline.com.au