SCOR estimates insured loss of $2bn as a result of Ever Given grounding

French reinsurer Scor has estimated that global claims relating to the six-day March 2021 grounding of the Ever Given (IMO 9811000) containership in the Suez Canal will eventually come to more than $2bn.

Sylvain Gauden, Chief Underwriting Officer for Marine and Energy Reinsurance at Scor, said that “he grounding of the giant Ever Given has shown the world the hidden reality of our economic system. By now we all pretty much know what happened.”

A sandstorm, poor visibility, a strong south wind and some miscommunication combined to make the Ever Given accelerate in the narrow channel, wedging it diagonally in a part of the canal that has no alternative channel.

In the Ever Given incident Scor noted that matters were complicated by the fact that the parties involved – the shipowner, the charterer, the owners of the goods, and the Suez Canal itself – had insurance policies originating from all over the world. All sought to recover at least some of their losses from other parties involved. The claims include physical damage (to the Ever Given), loss of revenue (on the part of the Suez Canal Authority), the cost of the salvage operations and business interruption (for owners and charterers of the blocked vessels), loss of perishables and cargo delays, and physical damage to the canal itself.

Gauden said that “understanding the consequences of such an event means taking a holistic view. Who are the stakeholders? Which insurance policies can respond? What is their exposure? How much is this going to cost? All branches of marine insurance are concerned, and the interests are multiple and sometimes divergent.”

Scor said that it would take many years to settle the claims from the Ever Given and the process would include much debate about who was liable. “The issue of responsibilities and applicable laws in today’s global maritime world is complex”, said Scor, noting that reinsurers would be absorbing the bulk of the claims, which could amount to more than $2bn.

Although the blockage lasted for six days, the Ever Given became something of a hostage, held in a lake, with its many containers, in the centre of the Canal for three months while the Suez Canal Authority and the vessel owner Shoei Kisen Kaisha negotiated over compensation.

Freed in July, the ship made its way to northern Europe, offloading the much-delayed cargoes, before returning through the canal en route to northern China. When it arrived there, extensive repairs were carried out.

Gregory Delaisse, Scor’s global head of marine and transport, said that “as reinsurers we need to measure our potential exposures. Container vessels are getting bigger, yet at the same time, there is a shortage of containers. This is leading some shippers to move cargo in inadequate bulk carriers”.

2018-built, Panama-flagged, 219,079 gt Ever Given is owned by Luster Maritime/Higako Sangyo care of Shoe Kisen KK of Imabari, Ehime, Japan. ISM manager is Bernhard Schulte Hong Kong. It is entered with UK Club on behalf of Luster Maritime SA.

https://www.scor.com/en/expert-views/lessons-ever-given