TT Club reduces estimates of 'Maemi' claims
31 October 2003
TT Club, a leading transport insurance provider, has confirmed that its latest assessment of claims resulting from Typhoon Maemi, the devastating storm that hit South Korea on 26 September, is substantially reduced from the initial estimates of US$40-50 million, with the likely level of claims faced by the mutual not expected to exceed US$25 million.
"The claim will not have a significant impact on the Club's financial performance in 2003," said Paul Neagle, chief executive. "Claims of this magnitude are extremely rare in the ports and terminals industry, and the Club purchases catastrophe reinsurance protection to cover precisely such an event," he explained.
TT Club attributes much of the improvement in the anticipated level of claims to the mitigating actions taken by its emergency response team on the ground, in its Asia-Pacific offices and at its London headquarters. Announcing the much-reduced claims forecast, the insurer also released details of its responses in support of its members in the wake of the typhoon.
"In order to minimise disruption to the businesses of affected members it was essential to react swiftly and to deploy sufficient resources," commented senior claims manager Colin Fordham. "From our long experience of dealing with the effects of calamities like this across the world we know that our members' losses can often be reduced substantially when they get the right emergency support."
Within two working days of the storm, the worst in Korea since 1904, the Club's emergency response team was in place, with TT offices in Hong Kong and Singapore and correspondents in Korea linking their efforts through the Club's London headquarters. The Club also moved quickly to appoint specialist accountancy consultants to help in the assessment of business interruption claims.
George Fawcett, another member of the response team of thirteen executives and specialists assembled in London and Asia, explained: "Work started immediately to arrange site visits for debris removal and to assess the extent to which assets could be salvaged. By the Wednesday after the storm we had a specialist crane engineer from London and a loss adjuster from Singapore on site."
Within three days the Club's specialists had visited all affected members and, throughout, the reinsurance markets has been kept fully informed through the brokers involved.
"Our combined property and liability package has responded effectively to members' claims for property, carrying and handling equipment, business interruption and defence of members against other claims," said Patricia Ng, senior claims manager in Hong Kong. "Comments we have received from members have been appreciative of the scope of cover and extent of our response," she added.
Some of the most dramatic images of Busan after 'Maemi' show giant gantry container cranes weighing hundreds of tons sprawled across container stacks and making the quayside impassable. Dongbu terminal, for example, lost six of its seven cranes. In addition, hundreds of containers, some with cargo, were flooded by a tidal wave of seawater.
With four badly-hit container terminals and a number of other premises out of action following the storm, the Club's emergency team is still in place, helping members with salvage, mitigation, equipment sourcing and cargo diversion. The Club said it would only stand down the team when all outstanding issues have been resolved.
ENDSNote to editors:
The TT Club is the international transport and logistics industry's leading provider of insurance and related risk management services. Established in 1968, the Club's membership comprises ship operators, ports and terminals, road, rail and airfreight operators, logistics companies and container lessors. As a mutual insurer, the Club exists to provide its policyholders with industry-leading benefits, which include specialist underwriting expertise, a world-wide office network providing claims management services, and first class risk management and loss prevention advice.
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