TÜRK P&I INSURANCE

Ufuk TekerGeneral Manager of Türk P&I Insurance

We will…

• give insight to establishment of Türk P&I Insurance • briefly explain why having a local insurer is a plus

• describe the cover we provide • give an insight to the rules governing Türk P&I s operations

TÜRK P&I• Türk P&I received its license from the Turkish Ministry of Treasury on

18.2.2014 and immediately commenced accepting risks within The Turkish marine insurance sector being the first local P&I insurance company in Turkiye.• 3 state enterprise insurance companies, Güneş Sigorta, Halk Sigorta and

Ziraat Sigorta and 3 local P&I Club correspondents Metropol Shipping AS, Omur Denizcilik AS and Vitsan AS consociated to establish Türk P&I. • A representative from the Ministry of Shipping, Transportation,

Communication is a continuous member of the Board of Directors.

TÜRK P&ITürk P&I keeps continuous and close contacts with the local authorities and

relevant Ministries as well as Turkish Chamber of Shipping on a daily basis.Türk P&I is member of the Liability Insurance Committee of The Association of

Insurance Companies of Turkey.In the fields of shipping and other maritime affairs, Türk P&I is extensively

involved in and plays an active role in the governmental legislation programs and their feasibility studies with the relevant ministries and other governmental authorities.

Why Having a Local Insurer is a Plus?In addition to the listed advantages in the previous slide we will talk about privileges of having a local P&I insurer in Turkey:• advantages in communication – speaking the same language• developing tailor made products as per the needs of the local sector• swift and efficient claim handling • marine insurance know-how• improving the ship standards by loss prevention actions• tax income – inflow of international currency into an economy

P&I Insurance Cover• When you conduct a service to the third parties and use your

facilities, you have various exposures when something goes wrong. • The same applies to Shipowners or Operators. • The three marine insurances, H&M, Cargo and P&I can sometimes be

linked with each other in terms of completing the cover needed within the Maritime Industry but in most cases they clash with each other as they try to protect their own clients under the different covers they provide.

P&I insurance basically provides an insurance cover at sea for legal liabilities to third parties, environmental risks, crew claims, etc.

Which legal liabilities?

Risks covered by Türk P&I• Personal injury / illness / death• Collision • Wreck removal • Damage to fixed and floating objects • Accidental Pollution • Cargo damage/shortage • Fines • Stowaways• Other

•

Personal injury / illness / death

• P&I insurance covers an owner’s liability for death, personal injuries and illness of crew members which can occur on board an entered vessel, including death or injury of passengers, stevedores, pilots and any third party visitors to the ship.

Personal injury / illness / death

Also following expenses are covered;- Repatriation & medical costs of sick or injured crew,- Loss of crew members’ personal

effects - Crew substitute expenses- Sick wages- Damages / compensation

Collision

• No cover of the member’s ship• 1/4th of damage to other ship • or 4/4th with additional premium• Some consequential liabilities e.g.,

pollution, personal injury

Wreck removal • Incidental Costs for lifting, removal,

breaking, lighting or marking of an entered ship

• Liabilities incurred by a member as a result of the raising, removal or breaking of the wreck of an entered ship

• Liabilities incurred because of the presence or involuntary shifting of the wreck of an entered ship

• Liabilities incurred, including costs/expenses incidental to the removal and disposal of cargo and bunkers on board

Damage to fixed & floating objects

• Physical damage caused by an entered ship to:

– docks and terminals– fixed and floating objects– fishing nets – coral reefs

Pollution• Typical claims arising out of pollution - Liabilities for loss of and/or damage to

wild life and environmental contamination and pollution- Clean up costs - Preventive and mitigation costs and

measures - Costs of complying with Government

directions - Salvor’s compensation for pollution

prevention

Pollution: Clean up costs

Towage

• Claims arising during the towage of an entered ship

• Claims arising during the towage services provided by an entered ship

towage contracts must have been approved by P&I insurer

Cargo damage and shortage

The PandI Clubs are not cargo underwriters but they provide insurance for the members’ liability towards the cargo carried onboard including but not limited to;• liabilities for loss of or damage to the cargo • disposal costs of damaged cargo • cargo’s proportion of GA

Heavy weather: wet damage/loss

Finished steel products

Fines

• Related to Cargo • Related to Customs • Related to Immigration

• Related to Accidental pollution • Discretionary

Stowaways

- Costs of repatriation - Additional costs for security - Pre and post departure stowaway checks - Costs of disembarkation and accommodation of stowaway - Costs of arranging emergency documentation

The Rules Governing Türk P&I OperationsLocal Rules• 6102 numbered Turkish Commercial Code Articles 1247 – 1271 on

carriage of passengers and their luggage by sea.• General Terms published by the Under Secretariat of Treasury,

Directorate of Insurance on the compulsory insurance of marine crafts for the owners’ third party liabilities.• Tariffs published by the Under Secretariat of Treasury, Directorate of

Insurance on limits of liability of compulsory insurance of marine crafts for the owners’ third party liabilities.

The Rules Governing Türk P&I OperationsInternational Rules(a) Conventions which are binding for Turkey (due to being in force and directly applicable above the Code due to Turkish Constitution Article 90)LLMC on limitation of liability from the maritime claims.(b) Conventions which are not yet binding for Turkey (since not yet ratified)Nairobi Wreck Removal Convention on Wreck Removal.(c) Conventions which are not yet ratified by Turkey BUT Turkey incorporated most of the rules of such Conventions within its local laws. Athens Convention 2002 on carriage of passengers and their luggages by sea.

Reinsurance Arrangements of Türk P&I

• Türk P&I has its reinsurance arrangements under a quota share agreement with two major players within the Pandi Industry as well as on facultative basis with some others.• The claims are handled directly by Türk P&I by an experienced claims

team in Istanbul.

Türk P&I’s Products

• Türk P&I provides the following specially tailored products in addition to Classic P&I Cover for Cargo Ships:

Liability Insurance for Small Passenger Vessels and Ferries Liability Insurance for Fishing BoatsLiability Insurance Diving Schools and BoatsLiability Insurance for Private and Commercial Yachts including

Touristic Yachts

Aims• To prevent an incident occurring• To mitigate the consequences of an incident• To prevent it happening again by working with Members.How?• giving seminars, • conducting loss prevention, • making ship visits, • management audits, • making analysis of happened claims

Objectives

• Playing a key role in marine liability insurance sector• Providing P&I coverage for Turkish flagged ocean

going vessels engaged in international commerce • Providing P&I coverage for all ocean going vessels flying foreign flag• Being one of the recognized P&I Club in all over the world.