Charterers' Liability

The “charterer’s liability insurance” is a type of marine insurance. Most ships are chartered either on a time charter or voyage charter contract. In both cases the charterer assumes liabilities towards the shipowner because of damage caused to the ship in the course of cargo-handling or because of damage resulting from an unsafe port or berth. And also, the charterer becomes liable similarly to the shipowner, with P&I liability to cargo, pollution claims and etc. All charterers require cover for both damage to hull and other P&I liabilities. The so-called “charterer’s liability insurance” provides coverage for such risks.

Claims may arise in a variety of circumstances, such as when a charterer instructs a shipowner to load a cargo that unexpectedly damages a vessel’s cargo holds, or when a charterer orders a vessel to an unsafe berth which leads to grounding damage.

Charterers can find themselves with a liability for many P&I risks, but cargo claims are the most common area of exposure.

Scope of Cover

The terms of the cover are based on the Owners’ P&I Rules and the add-on for traders and cargo owners.

It includes:

– Cargo
– Pollution
– Personal injury
– Damage to hull
– Salvage
– Detention and similar delay
– Damage to other property
– Freight and bunkers contribution to general average
– War risks (including terrorism)
– Fines (customs, immigration and accidental pollution)
– Wreck removal