News / General Average declared on refloated Hanjin Aqua, but some shippers were uninsured

The 2013-built 4,500 teu Hanjin Aqua is expected to arrive under tow at Singapore tomorrow after being grounded off Sangiang Island, Indonesia since early December.

Owners have declared General Average and appointed average adjusters who will require security for 27% of the cargo value before containers can be released to consignees. This will be in the form of a guarantee signed by the shipper’s cargo insurers.

Both Hapag-Lloyd and ANL, slot charterers on the voyage, have kept customers informed throughout the incident, but for some other cargo interests the information flow has been sparse.

Container lines are often reluctant – encouraged by lawyers – to say anything to shippers when one a ship is involved in a casualty, in order not to prejudice any future court action.

Meanwhile, shippers on the Hanjin Aqua that did not have insurance – one marine cargo insurer The Loadstar spoke to recently estimated that some 40% of cargo carried in containers is uninsured – will be in a very difficult position.

The uninsured shippers will be required to remit a cash deposit of 27% of the cargo invoice value to the average adjusters before they can secure the release of their containers. If the GA amount has been overestimated it could take years for them to obtain a refund; conversely, they could end up paying much more as additional costs come in.

However, many sea freight shippers continue to take risk being uninsured, based on the law of averages that suggests a GA incident is extremely rare. This is an apparent disregard for the fact that a shipowner declaring General Average could potentially result in a business-ending situation for a shipper.

The Hanjin Aqua was en route from Adelaide to Jakarta on the evening of 4 December when it ran onto rocks after apparently taking action to avoid a collision with a passenger vessel. As a result, the ship’s hull was breached allowing seawater into No 1 hold, as well as to the bow thruster and ballast compartments.

Following several unsuccessful attempts to refloat the vessel using its main engine, and with the assistance of harbour tugs, the owners of the Panamanian-flagged containership signed a salvage contract with SMIT on 12 December.

A salving team at SMIT were able to pull the Hanjin Aqua off the rocky shallows on 6 January, after some deck containers were discharged to a pontoon to lighten the load.

The ship was carrying 2,303 teu of cargo for discharge at Jakarta, Port Klang and Singapore. It included hazardous waste, but according to Hanjin Shipping, which deploys the ship on its weekly AUS service, there was no danger of the vessel sinking.

After arrival at Singapore, the vessel will discharge the rest of its containers and then be taken to a shipyard for the damage to be assessed and repairs carried out.