PORTS AND TERMINALS INSURANCE

1 CONFERENCIA OAB/RJ DIREITO

RIO DE JANEIRO, BRAZIL

Geoffrey Conlin, Senior Associate, HFW LLP, Sao Paulo

T: +55 (11)975312677 (Mob)geoffrey.conlin@hfw.com

T: +55 (11)31792900 (Office)

Agenda

Introduction

Structure of P&T market

Trends in last 30 years

Concession Agreements

Major Incidents

Consequences

The Policy

Conclusion

Introduction: trends in last 30 years and structure

Historically ports were state owned and run entities

Move towards privatisation – growth through external investment

Expansion driven by manufacturing and container trade

Concession agreements (normally about 25 years)

Port Authorities and Specialist terminal operators

Container damage during loading and discharge

Damage to Reefer Cargo

Major Incidents - Mumbai, August 2010

Guayaquil - April 2010 http://www.youtube.com/watch?v=wQcoCM-pU-8

Consequences

1. Operational problems

Port closure, congestion and missed calls, stranded and perishable cargoes, pollution, floating objects, etc.

2. Expenses and financial losses

Terminal property damage (cranes, berths, etc.), vessel damage, wreck removal, death and personal injury, cargo loss and damage, third party claims, increased operational costs

3. Reputation risk and loss

4. Wasted management time

Consequences

5. Legal proceedings

Mandatory investigations Harbour Master

Health and safety enquiries

Criminal prosecutions

Public bodies

Civil claims Jurisdiction

Applicable law

6. Insurance claims management Local and global policies

Management of relationships

Prompt notification

Early deployment of experts

Ports and Terminals Insurance Policy

Complex range of risks when handling, storing and managing the secure onwards journey of goods

Insuring Provisions

Property

Customer Liabilities

Third Party Liabilities

Errors and Omissions

Fines and Duties

Conditions Precedent

Standard Trading Conditions

The Policy

Normal Exclusions

Event must occur during the policy period

Event must occur during the ordinary course of the insured operation

Strikes, labour disturbances

Terrorism, acts of violence, political risk

Any breach of SOLAS, MARPOL

Seepage and Pollution

Other Provisions

Duties to minimise loss

Claims Notifications

Claims Control

Conclusion

Complex package of different product lines

Additional products available at extra premium

Growth market

Privatisation

Global Trade

Complexity

High values

More development

Lawyers for international commercehfw.com

Geoffrey Conlin (geoffrey.conlin@hfw.com) HFW LLP, Sao Paulo, Brazil