Pirates are constantly attacking the crude oil cargo vessels in the Indian Ocean that leads to the rise of the insurance rates. In the last week, the U.S. flag Maersk Alabama was captured leading to severe anarchy in the maritime industry that is the reason behind the rise in the insurance rate to safeguard the vessel. Therefore, free auto insurance quotes are cheaper than marine insurance quotes.
The 1,100-TEU Maersk Line Ltd. ship and 20 American crewmen are in the captivity of the pirates. They had taken control over the ship about 310 miles off the coast of Somalia that was on its way to Mombasa, Kenya. The crew members regained control of the ship owned by the U.S. subsidiary A.P. Moller Maersk, after a long struggle. In a week it was the sixth watercraft hijacked inclusive of a smaller German-owned container carrier. According to John Woods, of the New York law firm Clyde & co, the pirate’s attack leads to the increase in the insurance rate and additional premiums are being charges for transit in those areas
He stated that the insurers in London are composing most of the policies and are trying to level war-risk rates. Vessel proprietors are compelled to accept out kidnap and ransom money insurance on ships that are sailing off the Somali coast. These people are forced to pay for the additional premium charges that address the ransoms and negotiation fee while dealing with the pirates. The pirates can charge ransom of $20 million high and it can be negotiated to reduce it to $1 million.
A cargo ship of Zim Integrated Shipping Services, the Africa Star was attacked by the pirates and it was kept from embarkation by barbed wire threaded along side the vessel. Last year the US as well as other countries deployed war ships close to Somalia coast to rescue the cargo vessels from the pirate attack. But in order to avoid perambulation the pirates are embarking farther out to ocean and continue to ransack the cargo vessel.