Winning the Wheel of Misfortune

• CASA conducts seminar on ‘Professional Indemnity Cover for Shipping Agents and Service Providers to the Transport Industry’

CASA the voice of the shipping industry organised a seminar on ‘Professional Indemnity Cover for Shipping Agents and Service Providers to the Transport Industry’ on 1 November at the auditorium of the Ceylon Chamber of Commerce. The program outlined details of a comprehensive professional indemnity insurance, including cover for losses caused by negligence, fraud, breach of intellectual property rights and other related risks. The event was attended by over 100 participants.

The seminar was conducted by Stuart Munro, CEO of International Transport Intermediaries Club (ITIC) which is the leading professional indemnity insurer of companies providing services in the marine, aviation and rail sectors. Prior to his current role as Chief Executive Officer, he was the Managing Director, Underwriting Director, General Manager and Marketing Manager of ITIC. Stuart Munro has particular expertise in relation to ship management contracts as he was part of the BIMCO Shipman revision committee which finalised the Shipman 2009 contract. Apart from his management responsibilities, Stuart is also the area executive for India, Sri Lanka, Hong Kong, Japan and Monaco. He has also spoken at many loss prevention seminars, ship management conferences as well as to ICS branches worldwide. 

Speaking at the event Munro highlighted the main areas which is covered by ITIC which includes negligence, liabilities of the principal, debt, fraud of employees, claims by an authority and email fraud. He called this the wheel of misfortune and shared many case studies from all around the world. He stated that the agents are responsible to comply with instructions, act with reasonable skill and care and act in good faith whereas the Principal also has the responsibility to indemnify the agent. 

 He also stated that in most jurisdictions agents are not liable for the liabilities of their principals but in some countries they are jointly and severally liable with their principal for matters which in most jurisdictions only involve the principal. Liability for cargo claims was sighted as an example. He said that the agent should always make it clear to vendors that he is an agent or otherwise he could find himself in the position of having contracted himself and liable for non-payment by the Principal.

Documentary errors, failure to follow instructions and failure to know port regulations are few causes of negligence that Munro highlighted in his presentation. He spent more time in shedding light on Email fraud which is a growing form of crime. He gave the following tips to the participants on how to avoid being a victim of such fraud: 

• Don’t trust location of suggested new bank account – EVER
• Request for unusual intercompany transfers – check first by PHONE
• New bank account of charterer/supplier – always check by PHONE 
• If you ask for clarification by email, the response will come from the CROOK
• If you do email, use email address you used previously – don’t ‘reply to all’
• Bank accounts never close during an audit – that is a LIE
• The reason why violent crime is down is because more are getting mugged over the internet – don’t let it be YOU 

The event concluded with a panel discussion which was attended by the Speaker, Stuart Munro; Sri Lanka Insurance Brokers Association President Pritha Fernando; CASA Chairman Ruwan Waidyaratne and CASA Vice Chairman Iqram Cuttilan. The Seminar was organised by the Education and Training committee headed by Anoma Ranasinghe under the advice and directions of Walter Rodrigo, Director, McLarens Holdings and the Chairman and Executive Committee of CASA.