The American Institute for Marine Underwriters (AIMU) has issued a report examining the unique challenges for marine underwriters when it comes to dredging and related marine contracting.
Prepared by the New York-based AIMU's Technical Services Committee, the report discusses the different types of dredging activities and equipment used and examines the exposures both from a hull, crew, P&I (Protection & Indemnity insurance) and marine liabilities perspective.
Important to the conduct of maritime commerce throughout the United States, dredging activities occur on inland waterways, within ports and harbors and in coastal areas, as well as in support of new construction projects.
Dredging is the underwater removal of sand, soil or silt, and its movement from one place to another, for purposes of deepening a channel or navigable waterway.
The dredged material is often used for beach replenishment, land reclamation, or for fill in commercial or industrial projects.
Maintenance of navigable waterways depths is a continuous process in many ports and harbors where bottom contours are constantly changing due to silting near the mouth of rivers. As ships become larger and draft requirements (depth of the ship's hull below the waterline) increase, ports may need to deepen their channels to allow for deeper draft ships, in order to remain competitive with other ports.
Underwriters need to understand the dredging project and the scope of the work in order to understand the insurance exposures. The areas of operation for a dredging project can be private ponds or waterways, ports and harbors or coastal zones, including bays, inlets or sounds.
Some of the most common sources of severe losses aboard a dredge include fire, heavy weather, towing, mechanical damage, P&I exposures and environmental damages.
The report concludes that given the ongoing needs for maintenance and improvements in our nation's ports, waterways and shorelines, as well as urban redevelopment along water fronts, it is certain that dredging and marine contracting will remain a vibrant and important segment of the North American maritime industry.
A copy of the report can be downloaded from AIMU's Web site at www.aimu.org.
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