KUALA LUMPUR: The setting up of Perlindungan dan Indemniti Malaysia Sdn Bhd (P&I), a government company which provides liability insurance cover for small ships, has been welcomed by local vessel owners.
Transport Minister Datuk Seri Liow Tiong Lai said the move has helped owners of small vessels ease their burden of funding insurance liability coverage.
P&I will be able to sell the insurance coverage at a lower cost and cover at a wider range, he told the New Sunday Times.
Since 2011, the country’s national maritime laws require necessary insurance liability coverage to be in place for all ships plying Malaysian waters, be it Malaysian or foreign ships.
But owners of ships weighing under 300 gross tonnage were finding it too expensive to pay the insurance premium.
Liow said P&I would cover small shipowner liability insurance scheme for vessels under 300 gross tonnage.
It would also cover liability arising from personal injury, death, damage from fixed and floating objects, environment pollution liability, cost of compulsory wreck removal and crew liability, including abandonment of seafarers.
Its goal is to provide marine liability for coverage up to a combined single limit of US$400,000 (RM1.6 million) for ships of less than 300 gross tonnes.
The setting up of P&I will further spur the sector’s competitive-ness within the region as well as internationally.
Malaysia is ranked among the top 30 trading nations globally. It is also among the top 30 in terms of shipping, with a gross tonnage of 7.3 million, excluding ships of less than 100 gross tonnage and purely domestic ships.
“Clearly, maritime insurance is crucial in order to minimise the risks in the shipping line,” Liow said.