HFW lawyer Richard Neylon has said he is optimistic vessels that remain trapped in Ukraine and have not been able to take part in the recent United Nations agreement on grain exports can eventually sail free.
The UN-brokered agreement allowed ships carrying grain and other food exports from three Ukraine Black Sea ports to depart the country.
But ships without grain cargoes, or that are at ports not included in the agreement, have remained stuck in the war-torn country
War risk policies allow shipowners to declare the vessel a constructive total loss if they are blocked or trapped from sailing from a war risk port for 12 months. Some agreements apply the blocking and trapping clause after just six months.
At the International Union of Marine Insurance conference in Chicago, Neylon said he is handling five claims from owners that have declared constructive total losses after six months.
But he pointed to an improving situation.
Neylon said: “Things are looking more positive.”
He added that he is “cautiously optimistic” over the chances of getting ships carrying non-permitted cargoes from a port covered under the agreement.
Neylon did not mention any specific ships, but the 9,403-teu container ship Joseph Schulte (built 2014) had been caught in the port of Odesa since the outbreak of war. Although the port is part of the UN agreement, the ship is not carrying agricultural cargo.
Ships at the port of Mykolaiv, which is not part of the UN agreement, have also not been allowed to leave. They include two tankers: the 46,600-dwt MTM Rio Grande (built 2007) and 38,000-dwt Harald Maersk (built 2009)
The clock is ticking on insurers that have covered ships under war-risk policies and could be facing constructive total loss declarations after 12 months.
Neylon compared the situation to that of the Somalia piracy crisis in 2008, in which he was also closely involved, when ships that were held ransom at the port of Eyl for extended periods were declared constructive total losses.
Similar to the Somalian case, the ships trapped in Ukraine are still likely to have a high value even if the blocking and trapping clause is applied and they are declared losses.
The vessels will still be in good working order and hold value, from which the insurer could recover its losses. However, there is less certainty over whether ships in Ukraine will sail free.
