A newly effective port security law could have far-reachingeffects on inland marine transport, possibly delaying shipments,according to the Inland Marine Underwriting Association's presidentand chief executive officer.

Ronald Thornton, who heads the IMUA, told National Underwriterthere would be some effect on truckers going in and out of theports, but "whether this bill will create some delays in transit, Idon't know."

Mr. Thornton said that while it most likely will not affectcoverages or pricing, "if there are delays caused by this in thesupply chain, if there are issues where merchandise gets stopped ordelayed, then it's a whole new ballgame."

Titled the Port Security Improvement Act, the measure thatPresident Bush signed into law Friday was designed to strengthensecurity at U.S. ports by establishing improved cargo screeningstandards.

The new law provides incentives to importers to enhance theirsecurity measures and implement a framework to ensure thesuccessful resumption of shipping in the event of a terroristattack.

The legislation, drafted by Susan Collins, R-Maine, chairman ofthe Homeland Security Committee, and Senator Patty Murray, D-Wash,also requires the Department of Homeland Security to develop a planfor the resumption of shipping in the event of a terrorist attackand install radiation detectors at the 22 largest American ports bythe end of next year.

Mr. Thornton said coverage that could come into play as a resultof the new law includes protection "for the carrier's liability tothe cargo it's carrying, or from a transit insurance standpoint,where the shipper or consignee takes out insurance for their ownaccount."

He explained that inland marine already covers cargo from thetime it's picked up to the time it's delivered, "so it's not goingto change that. What might change is how it affects goods intransit for a lot of companies working with the just-in-timedelivery."

Another issue, he said, is the types of security measures thatwill be put in place. He noted that the bill's wording discussesports, trucks, containers, barges and railroads.

"Will they screen more containers, put biometrics in--how willthey do that, and what will it do to delays in the supply chain?"he asked. Even though this is a port bill, "there is somediscussion about what it will do if law enforcement does morerandom checks of trucks moving on the highways--that's a bigunknown right now."

He also wondered what the measure would do to vessel loading,turnaround and delivery. "So, we're early on. There are preliminaryindications that it may do something, but what that is remains tobe seen."

According to the Senate Committee on Homeland Security andGovernmental Affairs, approximately 95 percent of the nation'soverseas trade--worth nearly $1 trillion--enters or leaves throughU.S. seaports.

Foreign vessels carry the bulk of the approximately 800 milliontons of goods that come into the country. In fiscal year 2005alone, more than 11 million containers arrived on American soil bysea, and that number is growing at a rate of more than 10 percent ayear.

The act, which authorizes $400 million for port security grants,would, according to the Senate Committee:

o Help secure cargo and seaports.

o Help prevent a lengthy shutdown of America's seaports in theevent of an incident.

o Provide layered security at every step of the supplychain.

o Push the borders out so limited resources can focus on suspectcargo.