Owning an ROV or AUV comes with a unique set of risks due to operating in rough environments. Marine equipment can be very expensive to fix so therefore it is vital to have the correct insurance in place. Continue reading to find out why you need to insure you’re marine equipment.
What is Marine Equipment Insurance?
Marine Equipment Insurance provides cover for remotely-operated (ROV) and autonomous underwater (AUV) equipment, owned or operated by specialist contractors such as subsea equipment used by the research and leisure sectors.
ROVs, AUVs (and similar marine equipment) are used to perform inspections and other tasks underwater, often at a considerable depth. As well as exploration and production, the equipment is also used for the commissioning and decommissioning of platforms and other production infrastructure. Other similar equipment can be insured in the marine equipment market, as well as equipment on platforms or onshore such as integrity-testing equipment.
Who typically owns marine equipment?
Equipment is typically owned and used by specialist contractors and service providers. It might be hired in, and of course those who hire it out will want to protect their investment as well. As ROVs and the like become more commonplace, many universities and other research establishments own and/or operate equipment themselves.
Why is specialist cover needed?
Many other types of insurance can offer cover of one sort or another for marine equipment, but most will exclude equipment whilst being tested, worked upon and whilst in use in water.
ROVs are expensive to produce, operate, maintain and replace so without the correct insurance in place, businesses are exposing themselves to a high level of risk. Given the rough environments in which ROVs operate and the limited control operators may have over them, the risk of damages or loss is relatively high. Sourcing the correct cover can be complicated, which is why it’s always worth speaking to an insurance broker to ensure that you are fully protected.
What cover is included?
Standard cover under a specialist marine equipment policy would include the following at varying limits:
- Physical loss or damage to the equipment itself
- Hired in equipment
- Negligence of the operators and /or crew whilst in operation
- Employees’ tools and equipment
- Removal of wreck
- Sue and labour
- Recovery costs
It is worth noting that some insurers can also include cover for latent defect in the equipment whilst operating, however some insurers will exclude this.
The use of subsea equipment is rapidly increasing and there is the need to ensure both the subsea equipment and topside equipment are covered whilst:
- Deployed and recovered
- Being operated on board vessel and / or rigs
- In transit both to and from operations, whether that be by road, sea, air or rail
- In storage
- Undergoing maintenance
The specific conditions and exclusions applied by insurers will vary but it is worth noting that many of these will not necessarily be noted on the Policy Schedule, but instead will be within the policy wording, so it is important to refer to this along with the Schedule.
Some common conditions or requirements that your insurers may implement, and therefore you should be aware of, are:
- The equipment must be installed, operated, and maintained by suitably qualified, competent and authorised personnel
- The ROV pilots are not to operate the equipment for more than 6-hours within a 24-hour period
- Underwater vehicles should not be launched or recovered when there are adverse weather conditions
- Manufacturers specified operating parameters and guidelines must be adhered to
- Special precautions may be required when operating from dynamically positioned vessels to ensure that the equipment is kept clear of thrusters and taut wires
- Underwater equipment is not to be operated in condition with poor water visibility, which is generally consider at 3 metres, unless sonar used
- When operating the equipment in unusually hazardous circumstances, prior approval must be sought
- Suitable precautions and preservation measures need to be adopted at all times
- Direct communications need to be maintained between the vehicle pilot and wheelhouse of support vessel
- Security requirements may be in place in respect of storage locations, which could include the requirement for an Intruder Alarm