Corrosion - Towergate Insurance

[GrahamM376]

It's too vague IMHO. There have been seacock failures in unusual cases in only 2-3 years. So do I buy a new HR, Malo, X-yacht, etc., and immediately replace all the brass seacocks just in case?

I've just had a good natter with Gus Lewis, RYA Legal Dept. Very helpful chap. Evidently the RCD requires all skin fittings to last for a minimum of 5 years without degradation. Therefore, any failure would constitute breach of the RCD by the boat manufacturer and they would be responsible.

Furthermore, under the Marine Insurance Act 1906, Sec 55. 2. c. Latent defects do not have to be covered under an insurance policy. This leaves us in the position where, if an insurer hasn't included latent defect cover in the policy, then they can reject any claim caused by a latent defect. If they do include cover, it's a bonus.

He also advised that we need a statement in the policy regarding consequential damage caused by the failure of an insured event. - i.e. they won't pay for the defective skin fitting due to hidden corrosion (as in the new terms) but will pay for the rest of the boat when it sinks.

 

[jfm]

Graham I wont go into detail here because I've replied on the other forum but:

1. I strongly disagree your 1st para about "responsible",

2. I do not agree your conclusions in the second para about that well-known clause in MIA1906.

3. I do however agree with Gus's view as reported in your third para, which is what I've been saying all along including today on the mobo forum. And I'd add that -at least as far as I know- Panatenius is currently the only mainstream insurer offering such a term in their policy (though if anyone is aware of other insurers offering the same term then I'd be delighted to be corrected on that)

 

[Stork_III]

Graham I wont go into detail here because I've replied on the other forum but:

1. I strongly disagree your 1st para about "responsible",

2. I do not agree your conclusions in the second para about that well-known clause in MIA1906.

3. I do however agree with Gus's view as reported in your third para, which is what I've been saying all along including today on the mobo forum. And I'd add that -at least as far as I know- Panatenius is currently the only mainstream insurer offering such a term in their policy (though if anyone is aware of other insurers offering the same term then I'd be delighted to be corrected on that)

Y Yacht Insurance has the following:

3 EXCLUSIONS

3.4.1 lack of reasonable maintenance
3.4.2 wear and tear;
3.4.3 gradual deterioration, weathering or damp;
3.4.4 corrosion or electrolysis;
3.4.5 damage caused by insects or marine life;
3.4.6 mechanical breakdown;
3.4.7 accumulation of rainwater or snow in or on the Vessel unless resulting

causes under section 3.4 above the Insurer will pay for the resulting direct loss or
damage; FIRE, SINKING, SUBMERSION, RIGGING FAILURE, COLLISION OR
STRANDING.
Does this cover the situation? Seems like it to me, but I'm certainly no expert.

 

[GrahamM376]

The comments about manufacturers being "responsible" comes from Gus Lewis, as does the one concerning MIA1906 -

(c)Unless the policy otherwise provides, the insurer is not liable for ordinary wear and tear, ordinary leakage and breakage, inherent vice or nature of the subject-matter insured, or for any loss proximately caused by rats or vermin, or for any injury to machinery not proximately caused by maritime perils.

As he's an expert in marine law and I'm not, I saw no reason to doubt his interpretations.

 

[GrahamM376]

causes under section 3.4 above the Insurer will pay for the resulting direct loss or
damage; FIRE, SINKING, SUBMERSION, RIGGING FAILURE, COLLISION OR
STRANDING.[/I]
Does this cover the situation? Seems like it to me, but I'm certainly no expert.

Problem, as I've said before is that I'm not a expert either. Now have a situation where 2 lawyers, one being the head of RYA legal dept, giving 2 different interpretations. I've no 'ing chance of judging who is correct:ambivalence:

 

[jfm]

The comments about manufacturers being "responsible" comes from Gus Lewis, as does the one concerning MIA1906 -

OK thanks. That wasn't stated in your post. In any case, I still disagree

 

[sailorman]

OK thanks. That wasn't stated in your post. In any case, I still disagree

Its a pity that the RYA hav`nt taken up the cause to protect their members

 

[jfm]

2 lawyers, one being the head of RYA legal dept, giving 2 different interpretations.

You only mention the job of one of the lawyers, as if being head of RYA legal dept trumps someone, say, practising big ticket law on much bigger deals in the City. Ask any aspiring smart lawyer whether his or her ambition is to be an employee of RYA and see what answer you get. Just saying, matter of factly, because you mentioned Gus's job, and no offence intended to anyone

EDIT - the main bit of Gus's actual advice on what to do is point 3, and as mentioned above I agree with him 100% on that - I've been saying it for yonks. So you have the unusual position of asking 2 folks for legal advice and getting one answer

 

[jfm]

Y Yacht Insurance has the following:

3 EXCLUSIONS

3.4.1 lack of reasonable maintenance
3.4.2 wear and tear;
3.4.3 gradual deterioration, weathering or damp;
3.4.4 corrosion or electrolysis;
3.4.5 damage caused by insects or marine life;
3.4.6 mechanical breakdown;
3.4.7 accumulation of rainwater or snow in or on the Vessel unless resulting

causes under section 3.4 above the Insurer will pay for the resulting direct loss or
damage; FIRE, SINKING, SUBMERSION, RIGGING FAILURE, COLLISION OR
STRANDING.
Does this cover the situation? Seems like it to me, but I'm certainly no expert.

The boss Barrie Sullivan is a very accomplished and clever, and is fair minded person with complete integrity imho. He genuinely wants to offer a great product. On the language above the clause is good enough on this point imho, if a little clunky, though there are a few other places where the Y policy wording isn't perfect (eg the 3P liability cover). Barrie knows this and will likely improve the wording in due course but in the meantime I'd say in a general sense that you have a good policy and good counterparty (in the form of Barrie and his team) if you're insured with Y

 

[Stork_III]

The boss Barrie Sullivan is a very accomplished and clever, and is fair minded person with complete integrity imho. He genuinely wants to offer a great product. On the language above the clause is good enough on this point imho, if a little clunky, though there are a few other places where the Y policy wording isn't perfect (eg the 3P liability cover). Barrie knows this and will likely improve the wording in due course but in the meantime I'd say in a general sense that you have a good policy and good counterparty (in the form of Barrie and his team) if you're insured with Y

Thanks for that interpretation, I am insured with Y, so good to know.

 

[GrahamM376]

You only mention the job of one of the lawyers, as if being head of RYA legal dept trumps someone, say, practising big ticket law on much bigger deals in the City. Ask any aspiring smart lawyer whether his or her ambition is to be an employee of RYA and see what answer you get. Just saying, matter of factly, because you mentioned Gus's job, and no offence intended to anyone

I did not mention which company you are a partner of because you specifically asked for that information to be removed from a thread I had posted in another forum. I also have no idea what area of law you normally practice, except that you seem to have good knowledge of marine. No offence intended.

 

[jfm]

I did not mention which company you are a partner of because you specifically asked for that information to be removed from a thread I had posted in another forum. I also have no idea what area of law you normally practice, except that you seem to have good knowledge of marine. No offence intended.

Absolutely none taken Graham. I was "just saying", in my bad habit of not being PC and calling spades spades.

BTW I do not practise marine law professionally, or insurance law. My day job is M+A financing and tax law. But don't make the mistake of thinking that the best person at doing something is the guy/gal who does it for a living. The best guy to drive a taxi is Sebastien Vettel but he doesn't actual drive a taxi. It's called "comparative advantage"

 

[GrahamM376]

I'm starting to become uneasy about some aspects of this thread. Towergate's name is highlighted as the bad guys but in reality, it's RSA who are the problem as underwriters and, they also underwrite policies for many other brokers. Towergate, unlike some others, are willing to listen and seem to be doing their best to allay concerns we have but I see no action from others. There are far more restrictive policies out there and some very bad experiences we hear about.

You quote two particular cases where you've done battle with them but many of us have had only good claims experience so far so, lets have a balanced view. Why not join in with my discussion with them and help sort out the areas of concern? I'm sure Nigel Mills would be receptive.

 

[jfm]

I'm starting to become uneasy about some aspects of this thread. Towergate's name is highlighted as the bad guys but in reality, it's RSA who are the problem as underwriters and, they also underwrite policies for many other brokers. Towergate, unlike some others, are willing to listen and seem to be doing their best to allay concerns we have but I see no action from others. There are far more restrictive policies out there and some very bad experiences we hear about.

You quote two particular cases where you've done battle with them but many of us have had only good claims experience so far so, lets have a balanced view. Why not join in with my discussion with them and help sort out the areas of concern? I'm sure Nigel Mills would be receptive.

The difference between my single-digits number of battles and the general run of the mill claims experience is that my cases were very large claims. As I've said 100x, all insurers are sympathetic on small claims but things change with large claims. Yet all of us only really care about large claims. Sure it is nice to get a £500 pay out for a gelcoat ding but it isn't life changing, whereas a non insured sinking of a £200k boat owned by Joe Average with a £120k mortgage (or whatever...) actually is a bit life changing

My hard experience on this matter leads me to like Towergate less than you. Obviously we can each have our own PoV on that.

If Towergate really want to improve their policy and get folks singing their praises on here I'm happy to help. I'd much rather the market were full of praiseworthy policies than lousy ones and I have but would rather not have an inbox full of emails from seriously distressed policyholders who have received "we aren't paying" emails* from firms including Towergate. If Nigel confirms he is actually on a project to improve his policy to get widespread "ybw approval" D) then feel free to give him my email and invite him to send his latest working draft of the new policy and I'll happily mark it up to make it "right". And I'll happily follow up in discussions with him or his legal team or whoever. I do however appreciate the Towergate are not always the underwriter so policy changes aren't something they can do without involving the underwriters

More generally, I'm expecting that following these zillions of posts/threads on here a number of the big players are now considering amending their policy terms. None of them incidentally are saying (afaik) I'm wrong in terms of the limitations I'm highlighting in their policies; their efforts are solely focussed I believe on the market forces/fair play issue of whether and how much to change the policy wordings. The policy wording changes do take a bit of time though, so we have to be patient

*In every case the insurer has been wrong imho and made to pay out in full ultimately, but not without effort and distress for policyholder in the meantime

 

[doris]

I have stayed with Pants primarily because of the claims adjusters used by a lot of the oppo. It is not just who underwrites the policy that counts but which adjusters they use. I have no idea how much these chaps are obeying orders but I have got friends with some horrendous experiences with the CAs of various big names. Hence my investigations last year and my remaining with Pants despite them not being the cheapest, just hopefully better long tem value.

 

[GrahamM376]

I have stayed with Pants primarily because of the claims adjusters used by a lot of the oppo. It is not just who underwrites the policy that counts but which adjusters they use. I have no idea how much these chaps are obeying orders but I have got friends with some horrendous experiences with the CAs of various big names. Hence my investigations last year and my remaining with Pants despite them not being the cheapest, just hopefully better long tem value.

The problem with Pants for me is the (IIRC) 28 day unattended rule. I'm back home for 5 weeks and the boat sits on the mooring - no problem with Towergate

 

[GrahamM376]

If Nigel confirms he is actually on a project to improve his policy to get widespread "ybw approval" D) then feel free to give him my email and invite him to send his latest working draft of the new policy and I'll happily mark it up to make it "right". And I'll happily follow up in discussions with him or his legal team or whoever.

PM sent, Nigel will be in touch with you.

 

[sailorman]

The problem with Pants for me is the (IIRC) 28 day unattended rule. I'm back home for 5 weeks and the boat sits on the mooring - no problem with Towergate

But Towergate possibly dont pay either so no issue

 

[GrahamM376]

But Towergate possibly dont pay either so no issue

They've paid me so far.

Was very surprised this morning when reading Pants Keyfacts. Contrary to people's comments on the forums, Pants are not only more expensive, they require boats to be inspected if unattended (which Towergate don't) and they also have exclusions for corrosion & wear and tear.

Pantaenius Keyfacts document - Significant exclusions or limitations - Faulty materials, faulty design and construction, latent defect, electrolysis, wear and tear.


 

[doris]

They've paid me so far.

Was very surprised this morning when reading Pants Keyfacts. Contrary to people's comments on the forums, Pants are not only more expensive, they require boats to be inspected if unattended (which Towergate don't) and they also have exclusions for corrosion & wear and tear.

Pantaenius Keyfacts document - Significant exclusions or limitations - Faulty materials, faulty design and construction, latent defect, electrolysis, wear and tear.

I have just spoken with Mike Holbert of Pants. The important bit of the their Exclusions is at the end of no.4 :Consequential damage......is covered provided that an Insured peril has occurred.