Vero Marine had several clients' cargo on board.

The container stack tipped over when the twist locks failed, which resulted in considerable damage to the containers and their contents.

Financial recovery from a shipping company can be difficult in these circumstances. Bills of Lading evidence the contract of transportation. For NZ exports, bills (other than charterparty bills) are subject to the Hague-Visby Rules 1968, incorporated into NZ law by the Maritime Transport Act 1994 (effective 1995). Heavy weather damage to cargo is generally a difficult avenue to pursue against the shipping company. It is seen as one of the inevitable perils of shipping cargo by sea - particularly from such a remote country as New Zealand. An exporter can find themselves with a large insurance claim, and unless the insurance company is experienced in pursuing recoveries, they will also find themselves with a much increased insurance premium to pay.

In this case, Vero Marine was able to prove that the vessel was unseaworthy. We recovered much of the loss we had paid out to our clients, so we were able to minimise the effect on their insurance costs.

A prudent insurer buys insurance themselves, from the reinsurance markets, for accumulation risks. As part of the Royal & Sun Alliance Group, Vero Marine has the backing of the Group's world-wide security and the backing of reinsurance protection arrangements. (At the time of writing, reinsurance costs are rising considerably, which affects marine cargo and hull premium pricing).

The diagram above was adapted from a CIGNA "Ports of the World" publication.


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