Cargo claims are the most common and costly category of P&I claims. Our analysis of the statistics over the past years (2016-2020) shows that 15% of all insured container vessels suffer a cargo claim a year.
Most common type of claim
- Wet damage (28%)
- Physical damage (23%)
- Temperature damage (20%)
- Unclaimed cargo (4%)
- Deterioration (3%)
Most common type of cargo involved
- Unitized (55%)
- Reefer (34%)
- Dry bulk (6%)
- Liquid bulk (3%)
- Steel products (1%)
Known causes of claims
The data shows TSC claims for container vessels, 2016-2020
Three types of damage stand for the majority of cargo claims suffered by container vessels: wet damage, physical damage and temperature damage. Accidental flooding of the cargo hold is not only the most commonly known cause, but these claims are also often the most expensive as such incidents damage numerous containers at the same time. Physical damage to cargo inside the container is often caused by insufficient lashing/securing by stevedores coupled with heavy weather during the voyage. In extraordinary cases, the containers may even be lost overboard.
Damage to refrigerated cargo
Damage to reefer container cargo is both frequent and costly when it happens. Not only is reefer cargo by definition heavily dependent on ideal conditions being maintained throughout the voyage, but the cargo is also intended for human consumption and, therefore, subject to strict regulations from the market and from government health authorities. Even minor changes in the quality may cause authorities to order the complete destruction of the cargo.
Evidence of importance from the time of loading is any carrying instructions received from shippers and/or charterers. Members should request such instructions to be in writing. The instructions should be followed unless they appear inadequate, based on the experience and expertise available.
If the temperature of refrigerated cargo received for shipment is different from that in the carrying instructions or from what experience indicates it should be, the bill of lading should be claused accordingly. Otherwise the carrier may be responsible for damage inherent in the cargo or caused during a time when the cargo was not in the possession.
There is important evidence to be collected and maintained regarding the carrying conditions during the voyage. The reefer log is a fundamental piece of evidence and should be stored safely. Vessels carrying refrigerated containers should have sufficient expertise, tools, spare parts and a supply of appropriate cooling medium to effect basic emergency repairs of the malfunctioning container on board.
A wide variety of refrigerated goods are carried in reefer containers of which fresh produce, frozen meat & fish, dairy products and pharmaceuticals are only a few. A single reefer container may carry a cargo value of several hundred thousand US dollars or more. Each type of cargo varies in its requirements for carriage temperature, humidity, stowage arrangements and ventilation. Acces the full advice on SCOL
Preventing the loss of containers at sea
The container industry is perceived by many as the modern face of shipping. Yet despite the sector being well regulated and highly regarded, containers are still lost overboard. This loss prevention report provides an overview of statistics, an insight into specific cases, and with the help of experts, delivers hands-on advice for preventing such losses. Download the full report
Fire! A guide to the causes and prevention of cargo fires
When a fire breaks out on board a vessel there is no fire service ready to assist in extinguishing it – it is up to the crew themselves. The consequences can be catastrophic, and all those who have worked on board a vessel are aware of the difficulties involved with managing a fire and the crucial importance of fire prevention. The information in this handbook is designed to assist shipowners and crews in those fire prevention efforts. Download the full handbook
IG Letters of Indemnity
The IG standard form Letter of Indemnity (LOI) wordings may be downloaded below: