18-12-2017

P&I cover for autonomous vessels

Developments continue apace and leading industry players expect to start seeing remotely operated vessels in commercial operation by 2020, if not before.

One of the first types of commercially operated unmanned vessels is expected to be offshore industry support vessels. There has also been significant interest in the new technology from builders and owners of tugs, with one major operator having trialled the navigation of a tug controlled from land this year.

As the leading P&I provider for small and specialist vessels, the Club has been actively monitoring these developments to ensure that we are ready to assist Members as and when they choose to embrace these new technologies.

The Club has always worked with Members to insure their liabilities in connection with the ownership and operation of their vessels. In the 162 years since the Club’s beginning, the vessels we insure have changed dramatically. The number of crew onboard has decreased as technology has improved and certain functions have been streamlined or handled ashore remotely. For many years we’ve covered the use of Remotely Operated Vehicles (ROVs) in the offshore sector, albeit these are typically operated from onboard a fully manned attendant vessel rather than from a remote bridge onshore.

How will these changes affect the risks owners face?
The introduction of unmanned and autonomous vessels will change the profile of risks faced by Members.

Around 47 per cent of the claims the Club deals with involve some degree of human error. Elimination of many of the key factors that contribute to human error (shift work, difficult sea conditions, fatigue and so on) should therefore lead to a reduction in claims for both remotely operated and autonomous vessels. This has the potential to cause a significant decrease in navigational and other operational claims.

The Club presently handles over 850 claims per year relating to crew for matters such as injury, death and repatriation, such claims represent 34 per cent of the Club’s claims expenditure. The elimination of such risks would be of obvious benefit to those working in the maritime industry, as well as to vessel owners and operators.

It remains to be seen how the risks associated with the interaction between manned and unmanned vessels will be managed. This is an area we are keeping a close eye on. The risks could also differ depending upon where in the world a Member operates.

The operation of unmanned vessels are not without some risks. Owners of unmanned vessels may be more susceptible to piracy, as computer hackers have the ability to take control of vessels with no-one on board to manually override the hacker’s control. The maritime IT sector has a very important role to play in mitigating this risk, but as recent high-profile incidents involving IT security breaches have shown, the risk cannot be eliminated completely.

It is unsurprising that alongside the development of autonomous vessels there is a move toward more environmentally friendly methods of propulsion, including an increasing uptake of vessels powered by electric motors rather than diesel engines. These changes also affect aspects of risk – an all-electric vehicle would have no bunker fuel onboard and so would carry a lower risk of causing environmental pollution.

Where will the liabilities lie… will there be gaps in cover?
In our recent article Unmanned and autonomous vessels – the legal implications from a P&I perspective (here) we considered some of the main implications for the liability regime owners face.

There is a broad spectrum of autonomous vessels being developed ranging from minimally crewed vessels that are partially controlled by human operators on shore, to fully autonomous self loading vessels that are predicted for the more distant future. Club P&I cover is there to respond to the liabilities that Members face in connection with the ownership and operation of vessels and we are confident of being able to provide cover for the autonomous vessels Members may utilise in future.

How will the Club help Members?
The Club is in communication with some of the top industry players developing autonomous vessel technology and preparing to provide equipment and related services to vessel owners. We are and will remain, at the forefront of developments in this area so that we can assess the impact on the risk environment, changes to legal liabilities and emerging cover requirements for Members.

When Members choose to utilise these emerging technologies, we will work with them to provide cover that meets their needs. It is hoped that the careful uptake of this technology will ultimately lead to an improvement in risk management and the claims we deal with as a Club. As a mutual association providing insurance at cost (and without any profit motive or shareholders to pay) we will of course reflect improvements in risk with improved terms of cover. We are already in talks with some of the developers of this technology in order to identify how this can be achieved.

We will continue to communicate relevant issues relating to risk, claims and loss prevention to Members via our Club communications.

It is our hope that in the long term, these technological developments will lead to improved risk profiles for Members, benefits to the safety and wellbeing of those working in the maritime sector and improvements in sustaining the marine environment.

Source: The Shipowners’ Club

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