Insurance and Legal Problems Ahead

As the security industry wrestles with the development of a new ISO standard for armed guards, lawyers and insurers have been discussing worst case scenarios where there is potential misuse of lethal force.

Using the case of the Italian marines onboard the vessel “Enrica Lexie”, the question has been asked about what would have happened if the case had involved a PMSC, rather than the military. What if it turned out that an owner had not carried out proper due diligence on the guard company including checking the licences?

What indeed. According to P&I experts, it seems that due to the lack of precedent, it is difficult to cost out who would pay what in certain circumstances.

Lawyers have also warned that misuse of lethal force could see the individual guard, the PMSC and the shipowner sued by the dead third party’s estate in a civil and criminal claim.

At the moment the concept of armed guarding rests very much on the concept of self defence – but lawyers are even beginning to get a little twitchy about this.

Naturally where there is such complex confusion there is some doubt as to whether insurers will actually pay out. Lawyers stress that there may be express exclusion of piracy in P&I policies, and there are questions of whether exclusion of cover because of presence of weapons of war or an exclusion of cover because liabilities could arise from terrorism.

At the moment there are so many grey areas because issues have not been tested. Even BIMCO’s Guardcon could hide some future concerns for shipowners, according to Lloyd’s List.

There is a growing feeling that cargo owners may look to pursue claims against PMSCs and, more likely, against owners if things go wrong.

The use of armed guards on ships does work to protect the vessels, and does deter pirates – but it seems it does come with some risks attached. Using weapons onboard commercial vessels is at once staggeringly simple, but exquisitively complicated. Guess no one will know until the courts get their teeth into things.