Ship Repairers’ Liability Insurance in the UAE

Ship Repairers’ Liability Insurance may cover the insured’s applicable legal liability arising from the repair, maintenance, servicing or alteration of customers’ vessels. It is intended for shipyards, marine workshops, specialist contractors and other businesses that take vessels or vessel components into their care, custody or control.

Cover applies only to declared activities and locations accepted by the insurer. Every claim remains subject to the issued policy wording, territorial and jurisdictional limits, deductibles, limits of liability, conditions and exclusions. The policy does not automatically pay for every instance of damage occurring while a vessel is being repaired.

What Ship Repairers’ Liability Insurance May Cover

Depending on the issued policy, cover may include legal liability for:

1. Vessels under repair: Accidental physical loss or damage to customers’ vessels while in the insured’s care, custody or control.
2. Repair and alteration work: Liability arising from declared repair, maintenance, servicing, refitting or alteration activities.
3. Third-party property damage: Accidental damage to property belonging to another party arising from insured operations.
4. Third-party bodily injury: Applicable legal liability for accidental injury to persons who are not employees of the insured.
5. Legal defence costs: Eligible defence costs incurred with the insurer’s prior consent, subject to the policy wording and applicable limit.

Cover may apply at the declared repair yard and, when specifically agreed, at other locations or while approved work is performed aboard a vessel. Any work carried out at sea, offshore, underwater or outside the declared territory should be disclosed before insurance is arranged.

Who May Need This Insurance?

The policy may be relevant to businesses such as:

1. Commercial shipyards and dry-dock operators.
2. Yacht and pleasure-craft repair businesses.
3. Marine engineering and mechanical workshops.
4. Electrical, welding, painting and fabrication contractors.
5. Vessel refit, conversion and maintenance contractors.
6. Specialists working on engines, navigation systems or vessel components.

Ship Repairers’ Liability Insurance is not necessarily a universal statutory requirement for every repair business in the UAE. It may, however, be required by a customer, shipowner, port, free zone, shipyard agreement, licence, tender or commercial contract.

Important Policy Conditions

1. Declared activities: The policy should accurately describe the types of repair, maintenance and alteration work undertaken.
2. Maximum vessel values: The maximum value of any vessel in the insured’s care may affect the required liability limit and policy terms.
3. Locations: Repair yards, workshops, docks and other work locations should be declared and accepted.
4. Contracts: Repair agreements, indemnities and contractual responsibilities should be disclosed where requested.
5. Hot work: Welding, cutting and other hot work should follow agreed permit, supervision and fire-prevention procedures.
6. Subcontractors: The use of subcontractors and the nature of their work should be declared to the insurer.

Optional Extensions

Subject to underwriting acceptance, extensions may be considered for products liability, pollution clean-up costs, wreck removal, sea trials, vessel movement, delivery voyages, loss of use or consequential loss suffered by a vessel owner.

These exposures are not automatically covered. Each extension may have its own limit, deductible, reporting requirement and exclusion. Pollution cover may also be limited to sudden and accidental incidents rather than gradual pollution.

Relationship with Other Insurance

Ship Repairers’ Liability Insurance does not automatically replace every other liability or property policy required by a marine business. Separate cover may be needed for Public Liability, Employers’ Liability, Professional Indemnity, property damage, machinery, motor vehicles, owned vessels or marine cargo.

The repairer’s policy also does not normally operate as Hull and Machinery Insurance for the customer’s vessel. It generally responds only when the insured repairer has an applicable legal liability under the policy terms.

Common Exclusions and Limitations

The policy may exclude or restrict liability arising from:

1. Faulty work: The cost of correcting or repeating defective workmanship may be excluded, even where resulting damage is treated differently.
2. Contractual liability: Liability accepted solely under a contract that would not otherwise exist at law.
3. Employee injury: Injury to employees may require separate Employers’ Liability or Workers’ Compensation cover.
4. Gradual pollution: Gradual seepage, contamination or pollution may be excluded.
5. Loss of use: Delay, demurrage, loss of charter or loss of use unless expressly included.
6. Owned property: Damage to the insured’s own vessels, tools, premises or equipment.
7. Excluded activities: Undeclared diving, offshore work, sea trials, towage or vessel operation.
8. Other excluded events: War, nuclear risks, deliberate acts, fines, penalties and other exclusions stated in the policy.

What to Do After an Incident

1. Protect people, the vessel and surrounding property from further damage.
2. Notify Al Buhaira Insurance as soon as reasonably possible.
3. Inform the vessel owner without admitting legal liability.
4. Preserve damaged parts, equipment and relevant evidence.
5. Keep photographs, repair records, permits and witness details.
6. Retain contracts, job cards, invoices and subcontractor information.
7. Do not settle a claim or incur defence costs without prior consent.

How to Request a Quotation

Marine repair businesses can submit initial information through Al Buhaira Insurance’s dedicated Ship Repairers’ Liability quotation page. The quotation may consider the nature of the work, annual turnover, vessel types, maximum vessel values, work locations, subcontractors, hot-work procedures, liability limits and claims history.

A quotation does not confirm that insurance has started. Cover begins only after the required information has been reviewed, the terms have been accepted and the applicable policy documents have been issued.

Documents Required

The insurer may request documents and information such as:

1. Completed proposal or quotation form
2. Trade licence and company details
3. Description of ship-repair activities
4. Annual turnover and projected contract values
5. Types and maximum values of vessels repaired
6. Repair-yard and workshop location details
7. Sample repair contracts and indemnity clauses
8. Hot-work and fire-safety procedures
9. Quality-control and inspection procedures
10. Subcontractor details and agreements
11. Details of sea trials or vessel movements
12. Required liability limits and extensions
13. Previous insurance details and claims history
14. Client, shipyard or port insurance requirements

Why Choose Al Buhaira Insurance?

1. Marine insurance range: Ship Repairers’ Liability Insurance is available within Al Buhaira Insurance’s marine liability products.
2. Dedicated quotation page: Businesses can submit their initial repair-operation and liability details online.
3. Operational assessment: Quotations can consider declared activities, vessel values, locations, turnover and requested limits.
4. Policy enquiries: Customers can enquire about issued limits, conditions, deductibles and extensions.
5. Claims enquiries: Policyholders can report incidents and submit supporting documents for assessment under the issued policy.

Frequently Asked Questions