There seems to have been a gradual but noticeable trend amongst cargo insurers to increase cargo survey waiver thresholds.
Some insurers have waived their survey instructions below thresholds as high as £25,000.
The rationale behind the trend is sound. Cargo surveys are expensive. Presuming that most claims below the threshold are valid and not hugely inflated then the saving in survey fees outweighs the financial benefit to insurers.
Obviously, this is difficult to demonstrate accurately. If no survey is conducted then it is impossible to tell if a claim is invalid or inflated. Ignorance is bliss ! ??
It is presumed, however, that insurers judgement is correct and survey fees are sufficiently high that waivers below certain limits are cost effective despite re percussive effects.
Insurers are unlikely to make any recovery in subrogation against responsible third parties without survey and have lost control of any potential salvage sale and proceeds.
The trend has had repercussions in the market. Cargo surveyors are receiving fewer instructions. The instructions received are on the larger more complex losses. The simpler, more mundane surveys are not there. The younger generation of experts have nothing on which to cut their teeth.
In order to make survey more cost effective lower down the claims ladder, it would be necessary to increase surveying efficiency and lower cost. The marine insurance market has been sometimes a little slow to embrace the new technology. However, the new SurveySmart app allows more cost effective survey.
On-line organisation of surveys, geographically, allows a sharing of transport costs amongst participating insurers and participating surveyors see a way of producing surveys more cost effectively thereby increasing the number of instructions…..
This has raised considerable interest amongst larger insurers who wish to regain control of their smaller claims and their surveyors who wish to regain their business !
Contact : Andrew James
Cargo Survey Control
e-mail : firstname.lastname@example.org
+ 44 (0) 7909991275