Financial Settlement in the Wake of The Suez Canal Crisis

Now that the logjam at the Suez Canal has been cleared, businesses with goods aboard the vessel - in addition to other ships delayed by the blockage – will begin the claims process to recoup losses from damaged cargo and general average losses.

The shipowner has appointed two maritime professional rescue teams from the Netherlands (Smit Salvage) and Japan (Nippon Salvage) to attend the ship. These teams will be working with the Captain and the Suez Canal Authority to design a more effective plan for refloating the vessel as soon as possible.

Evergreen Line will continue to coordinate with the shipowner and Suez Canal Authority to deal with the situation with the utmost urgency, ensuring the resumption of the voyage as soon as possible and to mitigate the effects of the incident.

As the vessel is chartered, the responsibility for the expense incurred in the recovery operation; third party liability and the cost of repair (if any) is the owners.

Mark Robinson, president at UPS Captial, told SCMR in an interview that the time of reckoning has just begun:

These are often time-intensive processes, and many businesses may be surprised to learn that carriers do not include coverage in the case of route disruption and often don’t cover losses associated with general average.

While this particular event relates to large freight and cargo, similar protection is important for SMBs who can feel particularly helpless when supply chain disruptions occur. In addition to monetary reimbursement, these policies help democratize access to support that helps claims get paid faster and more efficiently to sustain strong relationships between businesses and their customers.”

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