Maritime Liability

[Bernardyn]

James,

I have a client who does analysis of and calibration of reciprocating engines. It's a non-invasive procedure performed by a hand held tool my client manufatures. A couple of companies who have off shore drilling rigs have contacted my client about sending an employee to go on a rig and do analysis of these engines. My client is considering entering into a contract to do some work for these companies. Is there any need for Maritime insurance in this case?

Danny Nash

------------------------- Followup To - James,

What is Maritime coverage and when is it needed?

Thanks,

Danny Nash

------------------------- Followup To - James,

Tell me all you can about Maritime coverage.

Thanks,

Danny

[Roland]

- Generally speaking, Maritime coverage refers to any insurance that might be needed when the territorial operations of your business are international, or any insurance that would involve goods or risk of lawsuit/injury or having employees outside of defined naional borders.   Since each country has laws and a legal code that govern trade and liability and negligence and insurance, international areas tend not to, such as anything on the ocean outside of any specific national borders.

In order for me to provide an answer that is more specific to your needs, it might be easier for you to tell me exactly what you need this infromation for.

James Berliner

[Harlon]

- Danny,

There are books written on this subject.  Volumes. I can't even begin.  I would be happy to answer specific question(s) if you have one/several.

JAmes Berliner, CPCU

[Hamnet]

Danny,

Thanks for the details.  First off, I will assume your client carries basic business insurance. By basic I mean coverage exists for property exposures as well as liability exposures, including product liability, operations,completed operations, and premises.  If they purchased this policy in the US, and the business is based in the US, then their policy territory is probably the United States.  This means that there should be worldwide coverage, but only if suit is brought in the States.  Check their existing policy, and if this is the case and your client is OK with this, then you are all set for Liability.  

As for Workers Compensation, I will once again assume that they have a basic Workers Compensation policy.  This policy should be endorsed to have the "Foreign Voluntary Compensation" endorsement which will provide some Workers Compensation benefits while the employee is based outside the US.  For safe measure, the policy should also be endorsed to provide coverage for The United States Longshoreman and Harborworkers'(USL&H) Compensation Act.  In addition, if they are in international waters, they should also have coverage for the Jones Act endorsed onto their policy.  

The Jones Act is a federal act which provides benefits to injured employees(similar to Workers' Compensation) to masters and members of a US-flagged vessel.(A "flagged vessel" can be a pontoon boat taking a crew to a job site, or an ocean liner). State Workers' Compensation statutes DO NOT cover the vessel's crew, and employees can sue their employer for negligence. USL&H is a federal act(a/k/a the Longshore Harbor Workers' Compensation Act - LHWCA) was designed to provide compensation to an injured employee if the injury or death occurs upon navigable waters of the US - including any adjoining pier, wharf, dry dock, terminal, building-way, marine railway or other adjoining area customarily used by an employer in loading, unloading, repairing, dismantling or building a vessel. So, between coverage for the Jones Act, the USL&H, and Foreign Voluntary Compensation, you should have every angle for the Workers Compensation exposure covered.

James Berliner, CPCU