RI included on list of regions labeled war risks
RI included on list of regions labeled war risks
Fitri Wulandari, The Jakarta Post, Jakarta
Following the Bali bomb blast, an international insurance
committee has included Indonesia in its list of war-risk zones,
calling insurance and reinsurance firms to cancel or amend all
contracts with vessels sailing to the country.
Should ship operators insist on entering Indonesian waters,
they will be subject to additional premium.
Analysts warn the notice might discourage commercial vessels
from traveling to Indonesia and as such could hamper the flow of
goods into and out the country. This in turn could further hurt
the country's fragile economy.
The London-based Joint Hull Committee issued the hull war
risks cancellation notice Tuesday, only three days after the bomb
blast that ripped through two night clubs in Bali and killed over
180 people.
It is effective Thursday and applies to all Indonesian ports,
according to documents from the agency made available to The
Jakarta Post on Wednesday.
The notice applies to insurance and reinsurance contracts for
time covering war risks, the document said.
Indonesia is listed in the committee's "current exclusions"
list along with other war torn countries such as Israel, Lebanon,
Somalia, Congo and Sierra Leone.
"This coverage shall extend worldwide but in the event of a
vessel or craft insured hereunder sailing for, deviating towards
or being within the Territorial Waters of any of the Countries of
places described in the Current Exclusions ... additional premium
shall be paid at the discretion of insurers," the committee said
in its notice.
The Joint Hull Committee consists of two prominent
underwriters' associations: the Lloyd's Underwriters Association
(LUA) and the International Underwriters Association of London
(IUA).
IUA is the world's largest representative organization for
international and wholesale insurance and reinsurance companies.
Meanwhile, the LUA acts officially for marine underwriters at
Lloyd's, the world's leading insurance market.
Hotbonar Sinaga, the chairman of the Indonesian Insurance
Council (DAI) said the committee's notice might prompt ship
owners and operators to think twice before accepting contracts to
deliver goods in Indonesia.
"For those who have had contracts, they might go on with it.
But those who want to have contracts or to renew contracts, they
will think twice because they will have to pay higher premiums,"
Hotbonar told The Jakarta Post on Wednesday.
Hotbonar regretted the notice, saying it was exaggerated,
despite the Bali incident. The situation in Indonesia was not
that bad that the country could be categorized as a war zone.
"The cancellation is not a normal thing to do. They are just
exaggerating. The bomb blast only happened in one area, not the
whole of Indonesia. It is not a war zone," he stressed.
He predicted that the cancellation would not last for long.
However, he admitted that it could disrupt the flow of goods to
Indonesia.
Further, Hotbonar said that the DAI would file a request with
the committee to have Indonesia excluded from the list.
Joint Hull Committee Current Exclusion Countries
1. Persian or Arabian Gulf and adjacent waters including the Gulf
of Oman,
2. Angola (incl. Cabinda),
3. Israel,
4. Lebanon,
5. Libya (incl. Gulf of Sidre/Sirte),
6. Libya,
7. Eritrea,
8. Somalia,
9. Democratic Republic of Congo (formerly Zaire),
10. Liberia,
11. Sri Lanka,
12. Sierra Leone,
13. Gulf of Aqaba and the Red Sea,
14. Republic of Yemen,
15. Pakistan,
16. Oman,
17. Syria,
18. Algeria,
19. Egypt,
20. Indian Ports of 18 degree North, West of 73 degree East.,
21. Indonesian Ports