The Norwegian Hull Club is offering shipowners damage and loss of hire cover for exhaust gas cleaning systems, also known as scrubbers.
The move comes in response to technical concerns over the 4,000 ships that have either fitted, or are in the process of fitting, scrubbers to comply with the IMO 2020 regulation on global sulphur emissions.
There have already been widespread reports of breakdowns with the new technology, while there is a major question mark over who pays for the resulting losses.
Norwegian Hull Club said it had prepared the policy to help owners cope with potential problems.
Uncertainty regarding quality
It said: “ Norwegian Hull Club is aware that there is uncertainty regarding quality, design errors, potential defects and possible damage scenarios. As so many different types of scrubber exist, making general assumptions based on the limited number of cases seen to date would be, we believe, unwise.
"In addition, not all charter parties are clear on the contractual mechanisms should scrubber failure or damage occur. Is the charterer, for example, entitled to put the vessel off-hire? And who will be responsible for the additional cost of switching fuel from cheaper low sulphur fuel oil to more expensive heavy fuel oil?”
The Bergen-based mutual’s new policy is called Damage to Marine Scrubber Systems: Additional Costs and Loss of Hire.
The policy covers the damage plus the additional cost of switching from cheaper heavy fuel oil to more expensive low sulphur fuel oil.
Earlier, compatriot Norwegian marine insurer Gard issued a loss prevention notice describing a wide range of breakdowns it had experienced with scrubber systems.
Protection and indemnity (P&I) insurer North also said shipyards are struggling to cope with the huge backlog of orders to fit scrubbers because they had under estimated the complexity of the work.
