Extended Shipbuilders Guarantee insurance covers the cost of repairing errors in design in accordance with the individual shipbuilding contract between shipbuilder and operator. The shipbuilding contract is subject to review by the lead underwriter following the signing of a non disclosure agreement. The policy is issued for 4 years with a rollover annually from Year 1. The shipbuilding guarantee is primary to this insurance.
Scope:
Prolongs – on identical terms to those offered by the shipbuilder – the shipbuilder’s guarantee to the later of 5 years from delivery or the vessel's first Special Survey. Contrary to standard guarantees, Extended Shipbuilders Guarantee insurance also covers off hire expenses, both for consequential damages and for time spent on repairing errors in design.
Applies to:
Operators with large new building programmes, with specialised or high-spec tonnage, or anyone wishing to add an increased level of quality to the shipbuilding programme of their chosen shipyard.
The solution also provides a measure of protection of the operator's Hull & Machinery programme by removing consequential damages of errors in design. This may serve to keep insurance costs low or qualify for a premium discount.
How it works:
Extended Shipbuilders Guarantee insurance covers the cost of repairing errors in design in accordance with the individual shipbuilding contract between shipbuilder and operator. The shipbuilding contract is subject to review by the lead underwriter following the signing of a non disclosure agreement. The policy is issued for 4 years with a rollover annually from Year 1. The shipbuilding guarantee is primary to this insurance.
Markets:
Norway, Lloyd’s.
Price Range:
1-2 % of primary guarantee amount of USD 5,000,000. Top up cover available on demand.
Self Retention:
Consequential damage as per Hull & Machinery or Loss of Hire policy, Guarantee Claims subject to deductible between USD 250,000 and USD 500,000 depending on yard and ship type.
Time to market:
Minimum 60 days.
