AEGIS London’s Nick Waymark, class underwriter for accident and health, examines the risks facing crew working on the world’s most expensive privately-owned vessels.
Superyacht: the word positively wreaks of oligarchs and opulence. It conjures visions of multi-decked sleek, white floating hotels tugging listlessly on their moorings as the late afternoon tide ebbs in the harbour at Monte Carlo. Cocktails on the top deck at 6pm. Perhaps a light dinner while the crew casts off, heading for a rendezvous with breakfast in Sardinia.
But life on a superyacht is not always luxury and glamour. In 2016, a crew member aboard the 140-metre Ocean Victory suffered severe leg injuries caused by the boat’s anchor chain. He was transported to hospital but later died. Just a year earlier, a member of the 82-metre Kibo’s crew was injured and suffered brain damage from a fall while cleaning the hull. These huge boats may be the height of decadence, but they are demonstrably not without their risks to crew and passengers.
AEGIS London offers an insurance product for personal accident and medical expenses, which covers both crew and passengers aboard these vessels. Perhaps surprisingly, a superyacht is not defined as such by its cost, rather it is any yacht is excess of 24 meters that requires a professional crew. Typically, the value of these boats is around $1m per metre of length and the market for them continues to grow. According to a report in The Guardian, over 500 superyachts are currently being built in shipyards around the world while the global fleet of superyachts employs around 37,000 people
Most of these vessels are registered under flags of convenience such as the British Virgin Islands, the Cayman Islands, Malta and Gibraltar. However, precisely which laws and rights apply to crew can be difficult to unravel. Many superyachts operate in international waters and are run by management companies on behalf of their owners. Typically, they have 12–70 crew members. Many divide their time between the Mediterranean and Caribbean in an established pattern of usage known as ‘the milk run’, but a member of a superyacht’s crew could find himself or herself in locations all over the world.
In terms of the risks to which a superyacht’s crew and passenger are exposed, many are the same as those found on any large ocean-going vessel, but a superyacht does have a risk profile all of its own. The anchor chain, as illustrated by the Ocean Victory accident, is a particular concern. But also, these vessels tend to be filled with what might be called boys’ toys – helicopters, mini-submarines, jet skis. All very exciting, all inherently risky.
Onshore behaviour of personnel is also a key risk factor. After days at sea, officers like a drink, crew members, too. But sometimes that drinking can lead to tragic consequences. The Guardian article cites a case in 2013 when a young crew member, returning late from an evening out, climbed up to the top deck in order to gain access to the locked boat. His body was found the next day. The inquest judged that he had fallen, hit his head on the quay and drowned.
Perhaps most difficult to assess is the impact of the owner’s behaviour. Many superyachts and their crews are at the behest of affluent, strong-minded individuals used to getting their own way. Faced with a request to divert in order to take a sick crew member ashore, an owner may decide that their wishes come first and the crew member’s health second. Equally, crew onboard commercial ocean-going vessels are employed under manning agreements which set out rates of pay, crew quarters, meals and insurance cover – generally on a liability basis – while the duties towards professional yacht crew are less onerous and generally subject to the Maritime Labour Convention.
The good news is that accidents on these vessels are infrequent. However, products like AEGIS London’s serve another beneficial purpose. In the highly competitive market for good crew and officers, the provision of comprehensive insurance protection can be attractive to potential recruits. Because AEGIS London’s product is non-fault, claims can be paid rapidly. Personal accident cover sums insured are pre-determined, so provided there is an accident resulting in bodily injury, the sum insured will be paid. Similarly, medical cover is non-fault and the insured will be indemnified accordingly. The package also benefits from a 24/7 assistance provider: this is essential when the yacht ventures outside of the usual Mediterranean or Caribbean areas.
The owners of these vessels are also targets for litigation given their deep pockets. Insurance like AEGIS London’s provides the best possible treatment for crew members and guests, thus reducing the scope for legal action in the case of injury or harm.
At AEGIS London, our underwriting process is fairly rapid with business accepted all over the world. We will, however, charge higher premiums or decline crews which have above-average claims records or a poor safety record.
The market for superyachts continues to grow but its dynamics are changing. If anything, owners’ expectations are rising while the gulf between what we might call good yachts and bad yachts widens. Following the 2013 death on the Kibo, a British coroner wrote to the yacht’s owner expressing concern that crew members had worked additional shifts thus ‘potentially causing tiredness’. The nature of these boats and their owners means that such excesses are not unusual. The key is to protect the crews with products like AEGIS London’s and to remember that behind the image of sun, sea and champagne lie risks as real and hard-edged as any in the marine marketplace.