To Rescue or Not to Rescue

That was the question on Wednesday 22 August 2007 when the historic and former Sydney ferry, the Lady Cutler, was returning from refurbishment in Portland in western Victoria and broke down. It was reported that the Lady Cutler left Portland on Sunday evening 19 August 2007 for a 22 hour trip. It experienced engine problems, was reportedly forced 100km south due to bad weather and anchored off Barwon Heads.

ABC local morning radio ran regular updates of the fate of the vessel and its 6 crew.  Apparently a tug boat from Geelong arrived on Wednesday morning to tow it to safety and was turned around after the vessel's Insurer would not confirm it would meet the costs of moving it.

The owner advised the cost of hauling the vessel to Melbourne was around $25,000. 

By Wednesday afternoon the Insurer agreed to meet the haulage costs after the owner had advised the crew would have to abandon the vessel, insured for $1.6 million. The owner believes contaminated fuel may have caused the engine failure.

Media reports condemned the insurance company's behaviour suggesting pencil pushers in offices miles away were making slow, incomprehensible ("refusing to help") and incorrect decisions.  So many questions are raised and unanswered?

• What is the damage to the vessel? 
• Is it covered under any insurance policies taken out by the vessel's owner? 
• Has the insurance company been held to ransom by the vessel owner and media? 
• And who was so concerned for the safety of the crew after 48 hours to leave them adrift a further day?

Most policies require costs to be incurred in the first instance.  So why didn't the vessel's owner arrange towing, forward the invoice to the Insurer and argue policy application when the crew were safely on terra firma?

Author

Insurance Policy

Country: - Australia

Policy Description: - Marine

Insurer: - Unknown

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