The North P&I Club has notified the International Group of protection and indemnity insurers that it expects P&I-related claims of about $115m resulting from the loss of the 7,700-ceu car carrier Golden Ray (built 2017), according to sources close to the business.

However, the 13 International Group members, which split pooled claims costs of more than $10m, are concerned the final figure could end up being significantly higher.

P&I cover includes the initial emergency response, pollution control and wreck removal costs.

Costs exceeding $30m are met by the International Group’s reinsurance scheme under the pooling system.

The Golden Ray hull, which was declared a constructive total loss, was insured separately for $87m.

Cargo loss

P&I cover also shares part of the financial liability for cargo loss. The Golden Ray had 4,200 new cars onboard when it grounded off the US port of Brunswick in September.

However, it is the mounting cost of wreck removal that has placed the biggest question mark over the final bill.

Wreck removal is now expected to take more than a year, as the wreck has sunk further into the sandbank making the job increasingly difficult.

P&I sources are now estimating the growing Golden Ray bill will push the final International Group pool claims in the current policy year to more than $400m.

That may have played a part in the decision of most International Group clubs to seek additional premium from members at the next renewal in February 2020.

North P&I did not immediately respond to requests for comment.

In an unrelated development, market sources said Hyundai Glovis, owner of the Golden Ray, has recently taken on Aon as its P&I broker.

There is a question over whether the International Group could also be hit with a hefty €65m ($71m) bill for the wreck removal of the 22,000-gt cruiseship Sea Diamond (built 1986), which also sank off Santorini in April 2007.

Sea Diamond claims

The vessel was controlled by Louis Cruise Lines and had P&I cover with the West of England.

The Greek government initially decided to leave the wreck in situ.

However, environmental lobby group the Archipelagos Institute of Marine Conservation, complained to the European Union that by leaving the wreck in place Greece is violating pollution laws.

One of the arguments forwarded by the institute was that the Greek government would be able to recover the wreck-removal costs from the West of England.

Last month, the Greek Public Ports Authority (PPA) issued a tender for salvage companies to bid for the wreck removal at a budget of €65m after a Greek court ruling.

In the tender document the PPA said the money would be recovered from the owner, which is protected by its P&I cover.

However, the owner has indicated it no longer has any obligations to the wreck.

There are also doubts over whether the wreck removal will happen in the near future.

The budget appears to be well short of salvage companies’ cost estimates.

The wreck sits at a depth of 100 metres and still has pollutants onboard, making it a complex job.

It has been suggested that at a price of €65m there are unlikely to be any bidders by the 9 December deadline and the wreck removal will be delayed further.