LONDON: July 07, 2016. Following the explosion and fire at the port of Tianjin last year, insurance and risk management company TT Club is calling for greater adherence to International Maritime Organisation (IMO) recommendations for the transport of dangerous cargo in port areas.
"The explosion last August should be seen as a spectacular example of why those operating throughout the global supply chains should examine their work practices and risk procedures more thoroughly," said Peregrine Storrs-Fox, TT Club director of Risk Management. "With estimated insured losses between US$2.5 and US$3.5 billion, this incident becomes a focal point, drawing attention to underlying vulnerabilities within global supply chain processes," he added.
TT Club said its risk assessment surveys at ports over the last 12-18 months have found little adherence to segregation requirements for dangerous goods.
"Considering the continuing need in other parts of the supply chain, not only to review regulation and guidance, but also to promote sound corporate culture, it is perhaps time that the existing IMO recommendations are reviewed and some teeth added to bring about greater adoption at national level," said Storrs-Fox.
TT Club analysis of its claims history over the past five years has shown that incident causation is concentrated within five classifications, with 66 percent relating to road traffic and cargo handling collisions, fire, theft and poor cargo packing.
While the 7,500 insurance claims had an insured value of US$500 million, the company said the total economic costs should also account for hidden losses, such asmanagement time and distraction, and reputational damage.
"Clearly such matters need to be better integrated globally in order to improve practice in handling dangerous goods, resulting in the safety of workers and third parties, as well as maintaining the integrity of cargo and transport infrastructure," Storrs-Fox declared.