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BSC receives $22.48 million insurance money

Ship hit by Ukraine war missile


JASIM UDDIN HAROON and SYFUL ISLAM | March 22, 2023 00:00:00


The Bangladesh Shipping Corporation (BSC) received US$22.48 million on Monday as compensation for its ship that was hit by a missile last year after outbreak of the Ukraine war, the first such insurance-claim settlement after the war broke out.

The Sadharan Bima Corporation (SBC), the insurer of the ship, settled the claim on the day following its board approval, after receiving the payment in foreign currency from the Lloyd's of London player Beazley and broker Tysers, who channelled the money after collecting from a number of small re-insurers.

The re-insurers had covered liabilities totalling 97.5 per cent while the SBC covered 2.5 per cent.

The ship, namely 'Banglar Samriddhi', was hit by a missile on the night of March 02 last year, killing a crew member on the spot and injuring several others.

Following the incident the ship was abandoned on the spot and crew members were rescued and repatriated to Bangladesh in the following days.

As the war is continuing and the Russian authority did not guarantee any safe passage for foreign ships, the missile-hit vessel still remained in the same area.

Officials said as the ship could not be brought out of the area and it had been 12 months since the incident happened, the insurer declared a 'constructive total loss' in line with the insurance law and subsequently made the payment after completion of the formalities.

According to SBC officials, after declaration of a 'constructive total loss', the vessel was sold out at $1.275 million to Stork Shipping, a firm of Marshall Island. Of the money, the SBC got $33,747 and the re-insurer got the remaining $1.241 million.

"We've paid the total claim - amounting to $22.48 million - to the BSC on Monday," SBC managing director Sayed Belal Hossain told the FE. "We've transferred the amount in dollar to the BSC's foreign currency account," he added.

Of the total $22.48 million compensation, the SBC paid nearly 2.65 per cent, and the re-insurer paid the rest.

Earlier, the SBC settled claims worth $858,630.34 for the ship's crew compensation and repatriation, including death claim of its third engineer Hadisur Rahman.

After the war broke out in late February last year, when Russia invaded Ukraine, the Black Sea was declared as a high-risk zone for ships to ply, by the London insurance market, fearing incidents.

More than 60 ships remained stranded in Ukraine water following the war and as one year has passed, now the insurers have started to receive claims of millions of dollars.

The BSC had acquired the ship, a 38,896 deadweight tonnage (DWT) bulk carrier, in late 2018 along with its two other peers, built in China with funding from the Exim Bank of China.

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