Adjusters warn marine rates at crisis level

Some firms have sought to reduce costs via technology with the use of drones. Credit: DNV GL
Some firms have sought to reduce costs via technology with the use of drones. Credit: DNV GL

Loss adjusters and marine surveyors have warned that the pressure to cut the prices they charge is at the point where they are no longer sustainable.

While the global maritime sector continues its slow recovery, adjusters and surveyors warn that the recovery is not making its way into their sector. In fact it is becoming worse.

“The situation is now at the point of crisis. The rates we are being asked to charge are not sufficient to cover the costs if the staff who are meant to carry out the job. The shipping firms are looking for more reductions and the marine insurers are also putting pressure on firms to cut rates,” one surveyor told IHS Markit.

Some firms have sought to reduce costs via technology with the use of drones and video beaming back images to a surveyor now becoming ever more prevalent, but for others there is concern that unless firms are paid a proper rate there will need to be more drastic action taken.

A leading European loss adjuster explained, “The time is coming whereby we will have to offer a no-frills basic service to those who are unwilling to pay a reasonable rate for the tasks they are asking us to carry out on their behalf.

“The fact is that the jobs we do ascertain whether a vessel is seaworthy and therefore safe. The consequences of cutting the surveying services to save a few dollars could have significant impact if issues are missed for the sake of cost efficiencies.”

He added that staff were also demotivated given that they were aware of the stresses that firms were under because of the pressure on pricing.

“It is a question of value,” he added. “It is a specialist role and one that takes years of experience. That experience has to be recognised by insurers and the shipping sector.”