TT Club

20 January 2014

TT Club, the insurance specialist serving the global freight industry, continues to support innovation in the logistics sector.
TT Club, which provides liability, cargo and propertycover to freight forwarders and logistics companies, once more observes that innovation in technological capabilities and tailored supply chain processes is essential for logistics companies to thrive in a sustained competitive environment.
A long-term supporter of the British International Freight Association (BIFA) Awards, TT Club sponsored the 2013 European Logistics Award.  TT Club’s Development Director for UK and Ireland, Brian Sullivan, was part of the judging panel that employed a stringent vetting process to find the most deserving entry. This year the winner is DSV. The award was presented by Sullivan to DSV’s Chris Malyon at a ceremony in London on Thursday, 16 January.
The Club’s detailed knowledge of its own Members’ supply chain services has convinced Sullivan that the proliferation of innovation in the sector and a trend away from rate-driven commoditisation is a very real phenomenon.
“Many in the freight transport industry feel that pressure on rates from customers has shorn the operator of the necessary resource to deliver the added-value elements that distinguishes logistics from the straightforward  ‘A to B’ transportation of freight.  As a result of my own and the Club’s experience, I would contest this view,” comments Sullivan.
TT Club is certainly seeing more extensive services being provided by its customers.  Many companies that in the past offered traditional freight forwarding now take on a much higher degree of supply chain risk and sustain greater liability by providing increasingly complex and sophisticated services.
The trend is however seen as positive.  The increased complexity of service offerings and the ingenuity of operators in designing alternative supply chain solutions provides opportunity for new entrants as much as established logistics companies.
TT Club recognises the need to support and reward quality innovation in the industry and has been a sponsor of the BIFA awards since their inception nearly twenty years ago.  By the very nature of the insurance services it provides, the Club is at the heart of the supply chain industry and consequently, is able to monitor the dynamic trends that are always at play as logistics operators strive to improve their service offerings to meet market demands.

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Note to Editors:
The TT Club is the international transport and logistics industry’s leading provider of insurance and related risk management services. Established in 1968, the Club’s membership comprises ship operators, ports and terminals, road, rail and airfreight operators, logistics companies and container lessors. As a mutual insurer, the Club exists to provide its policyholders with benefits, which include specialist underwriting expertise, a world-wide office network providing claims management services, and first class risk management and loss prevention advice.

In a speech to be given at the TOC Container Supply Chain: Middle East Conference on 9^th December, Andrew Kemp, Regional Director EMEA of the freight transport insurance specialist TT Club will warn of the additional liability that freight forwarders and other logistics operators are open to as a consequence of dynamic changes in global trade.

London, 3^rd December, 2013

Statistics compiled by the World Bank reflect the fast-growing influence of the so-called South-South trade routes between Latin America, Africa and Asia. The value of exports on this trade now exceeds that between the developing and developed countries of the world, representing 32% of total global trade. As both an influential import/export region as well as a key hub for the movement of goods in the South-South trade, the Middle East, and its transport operators are experiencing significant growth opportunities.  In conjunction with this business growth has come a dynamic change in the amount and variety of services freight forwarders, logistics service providers and other transport companies are offering shippers.

“This trend is not limited to operators in the Middle East, indeed we are seeing such developments across the globe. However, I’m taking the opportunity of speaking at the TOC Conference to highlight the consequences of the changes to an operator’s risk profile to the freight transport sector in the region”, says Kemp.

Such new trade growth has meant that the demands on forwarders and other logistics operators are changing rapidly from the traditional organisation of international movement of goods.  Manufacturers, retailers and other shippers are increasingly requiring the provision of additional logistics services such as warehousing, sub-assembly and packing, with tight margins for error and sometimes harsh financial penalties for breakdowns in their supply chains.

As Kemp will highlight, “As a consequence of providing these additional services, whether sub-contracted or provided within their own operation, forwarders are typically accepting extended contractual exposure, in terms not only of the period during which customer’s goods are in their custody but also usually more onerous terms and conditions. Simply put, the more complex the services undertaken, the greater are the chances of errors and omissions occurring”.

TT Club has experienced an expanded range in types of claims occurring as a result of the extension of liabilities. With the increased complexity in services and contractual arrangements it is becoming important to select an insurer with specialism in assessing and advising on the level of exposure that the signing of a particular contract may imply.

Kemp will conclude, “Awareness of these circumstances, and the seeking of professional advice on the extent of the possible risks which may result, are essential for the modern day forwarder and logistics operator to assimilate, particularly when involved in the rapidly developing Middle East hub”.

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Note to Editors:
The TT Club is the international transport and logistics industry’s leading provider of insurance and related risk management services. Established in 1968, the Club’s membership comprises ship operators, ports and terminals, road, rail and airfreight operators, logistics companies and container lessors. As a mutual insurer, the Club exists to provide its policyholders with benefits, which include specialist underwriting expertise, a world-wide office network providing claims management services, and first class risk management and loss prevention advice.

London & Hong Kong, 7 November 2013

Freight transport insurance specialist TT Club is continuing its efforts to reduce risk in the supply chain.  Through constant analysis of the claims it receives, the international insurer has pinpointed an array of operational circumstances that more commonly cause dangerous incidents resulting in bodily injury, sometimes death, and significant loss and damage to cargo, equipment and property.

Following in a series of presentations at industry gatherings, by which the Club seeks to draw attention to such causes and advises on steps to improve safety, the latest effort was at a meeting last week in Hong Kong of members of the Japanese International Freight Forwarders Association (JIFFA) and hosted by the Hong Kong Japanese Chamber of Commerce & Industry.

Giving the presentation, TT Club’s Regional Director Asia-Pacific, Phillip Emmanuel commented, “The picture is very clear, the overwhelming majority of claims, some 95% of those we’ve analysed had causation that involved the human factor including operational causes and those related to maintenance (or lack of it); the remainder being down to weather events”.

The TT Club has for some time now been emphasising the need for operators to take more account of the human factor in their risk mitigation programmes.  “There is so much that can be achieved in reducing claims at ports, terminals and throughout the physical supply chain by establishing more robust training programmes for truck drivers and equipment operators as well as warehouse and terminal personnel, who are involved in cargo packing as well as container and truck movements”, highlighted Emmanuel.

Such training would help in reducing incidents that are caused by bad handling and stowage, which together make up nearly a third of those classed as systems and process issues in the TT Club analysis.  A further 40% or more of these issues were caused by errors that might be avoided had a more disciplined checking system been applied; these include clerical and contractual mistakes, incomplete customs declarations and the release of cargoes without receipt of the appropriate documentation.

Emmanuel also stressed that good management should include the provision of physical devices to enhance safety and security.  Extending beyond fencing and CCTV at terminals and warehouses to prevent theft, these may include anti-collision devices to avoid handling equipment accidents and regular maintenance using high quality spares to reduce the risk of fires.

As a final plea to transport operators, the Club highly recommends a detailed due diligence procedure be adopted and carried out when employing sub-contractors for transport services.  TT’s analysis reveals that of the costs accruing from theft, 66% occur either when carried by a sub-contractor or from a contractors’ premises.   “The phrase ‘know your contractor’ should be the guide for all transport operators seeking to protect themselves from the consequences of cargo theft”, concluded Emmanuel.

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Note to Editors:

A full copy of Phillip Emmanuel’s presentation is available on request

The TT Club is the international transport and logistics industry’s leading provider of insurance and related risk management services. Established in 1968, the Club’s membership comprises ship operators, ports and terminals, road, rail and airfreight operators, logistics companies and container lessors. As a mutual insurer, the Club exists to provide its policyholders with benefits, which include specialist underwriting expertise, a world-wide office network providing claims management services, and first class risk management and loss prevention advice.

London 29^th October 2013

82% of insurance claims related to cargo handling at ports are the result of operational shortcomings or poor equipment maintenance.  This revealing statistic was presented by TT Club’s Regional Director, Asia-Pacific, Phillip Emmanuel as he addressed representatives of South Asian ports at an industry conference in Mumbai last week.

Leading freight transport insurer, TT Club’s analysis of claims received over the past seven years show an overwhelming frequency of avoidable incidents resulting in bodily injury, damage to property, equipment and cargo.  TT Club urges operators at ports and other cargo handling facilities in the region to employ effective procedures, training and safety technology.  “The Club strongly believes that such measures will significantly reduce risk and bring commercial benefits such as lower insurance premiums and higher levels of customer service,” stated Phillip Emmanuel.

As regards the enduring problem of theft, Emmanuel suggested, “Prevention is a combination of: a physically secure site; rigorous checks and double-checks on paperwork and well-trained and well-motivated staff. “

Prevention advice formed a pivotal part of the presentation with Emmanuel strongly urging operators to carry out continuous safety training for their employees; pay particular attention to their security procedures to mitigate against theft and to up-grade traffic management systems to help avoid in-yard vehicle collisions.  In addition, investment in safety technology is advised.  TT Club have seen 236 quay crane boom to ship collisions in the past 7 years worth US$15m. Crane boom as well as mobile equipment anti-collision sensors and container weight and load eccentricity detection devices, among other measures, will pay off the initial installation cost through future savings on damage repair and operational downtime.

Rapid growth in cargo throughput has the effect of heightening the risk factors in handling facilities and port terminals and TT Club would caution operators in India not to lose sight of risk management issues as they also cope with the dynamic growth of throughput in their ports.  For its part TT Club has recently strengthened its resources in the region to better serve its Members. The appointment has been confirmed of network partner Pandi Correspondents (Mumbai) Pvt Limited, which has offices in Chennai, Kolkata and Goa in addition to Mumbai.  Pandi has been delegated claims handling authority providing the ability to settle claims in local time.

Emmanuel also sees this commitment to the Indian market as an opportunity to assist cargo handling companies with their risk management and loss prevention programmes.  “One of TT Club’s strongest attributes is its global claims service.  As a mutual we are dedicated to handling our Members’ claims in the most comprehensive and effective manner possible.  The elevation of Pandi to the status of a network partner will significantly enhance this service in the crucial Indian market,” he said.  “Moreover the Club is stepping up its efforts to communicate the lessons to be learned from our analysis of past claims and the extensive experience we have accrued from forty-five years of providing specialist insurance cover and advice.”

Emmanuel was speaking on the first morning of the 8^th Southern Asia Ports, Logistics and Shipping Conference in Mumbai.  He addressed business leaders from over thirty-five world-class transport companies and a total of some five hundred senior executives from twenty-five countries.  Running concurrently with the conference was an international exhibition featuring sixty companies from around the world showcasing their cargo handling, transport and logistics services.

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Note to Editors:
The TT Club is the international transport and logistics industry’s leading provider of insurance and related risk management services. Established in 1968, the Club’s membership comprises ship operators, ports and terminals, road, rail and airfreight operators, logistics companies and container lessors. As a mutual insurer, the Club exists to provide its policyholders with benefits, which include specialist underwriting expertise, a world-wide office network providing claims management services, and first class risk management and loss prevention advice.

London 25^th October, 2013

The TT Club is delighted to congratulate the Cargo Incident Notification System (CINS) on being presented with this year’s Containerisation International Award for Corporate Social Responsibility at a ceremony in London yesterday.

CINS was established in 2011 by five of the world’s largest shipping lines with the primary aim of growing a system designed to capture incident data from the container supply chain.  As a major insurance provider to container operators and handlers, TT Club was invited at the outset to act in an advisory capacity to the CINS Committee, alongside the International Group of P&I Clubs.

The CINS initiative was taken in response to the increasing volume of incidents that regularly disrupt operations and endanger lives, property or the environment, both at sea and on land. The founding members, CMA CGM, Evergreen Line, Hapag-Lloyd, Maersk Line and MSC, have been joined by an equal number of other lines, and the group now represents about 60% of container slot capacity*.  Managed by the Container Owners Association, it is expected that the CINS network will grow in coming months, as a number of other shipping lines have shown great interest in the initiative.

Peregrine Storrs-Fox, TT Club’s Risk Management Director said, ‘The most compelling result of the initiative will be an improvement in safety and good work practices.  It is exciting that CINS has been able to bring highly competitive shipping lines together in a concerted effort to identify the major common causes of dangerous incidents.  It has been an enormous pleasure to work alongside key individuals in these lines, who have formidable experience in cargo management.  This award is truly deserved’.

The CINS incident database is used to provide an early warning of causes for concern that may be trending.   In a year that has seen serious fires plague the maritime mode, it is sobering to note that the most frequent cargoes causing problems over the last two years relate to flammable, corrosive and environmentally hazardous products.

Investigations into the root causes of these incidents have revealed that most commonly issues pertaining to cargo packing  – packaging, dunnaging and securing  and declaration – are major contributors.   Such findings strongly support the need to conclude the IMO/ILO/UNECE Code of Practice for Packing Cargo Transport Units and see that good practice is widely disseminated.

The CINS Committee has commented robustly on the issue.  ‘CINS findings to date show a strong case to seek broader industry involvement, to increase the awareness of areas of concern and trends in containerised shipping, and continue to improve safety in the supply chain’.

Storrs-Fox concludes, “Nobody engaged in the supply chain industry would deny that there are many continuing or emerging unsafe practices.  For its part TT Club is committed to ongoing efforts to improve safety and mitigate risk as cargo volumes in global trade continue to rise.  Loss prevention is a basic principal of the Club.  As such we commend the vision of the CINS members as they seek to heighten awareness of these unsafe practices, working together to enhance safety, reduce cargo loss and minimise the risk to those employed at sea and ashore, as well as to assets and the environment”.

*Source: Alphaliner

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Note to Editors:
The TT Club is the international transport and logistics industry’s leading provider of insurance and related risk management services. Established in 1968, the Club’s membership comprises ship operators, ports and terminals, road, rail and airfreight operators, logistics companies and container lessors. As a mutual insurer, the Club exists to provide its policyholders with benefits, which include specialist underwriting expertise, a world-wide office network providing claims management services, and first class risk management and loss prevention advice.

Speaking at the recent TOC Americas Conference in Miami TT Club’s Senior Underwriter, Dan Negron outlined his views on future Latin American trade growth and the pressures that this will create on the region’s transport infrastructure.

London & Jersey City, NJ:  23 October 2013

While the growth rates of national economies in Latin America have slowed in recent years, the two largest economies, Brazil and Mexico are still forecast to increase by over 3% annually, while significant growth is predicted in Colombia (4.7%), Chile (5.1%) and Peru (6.3%). This growth is one of four factors identified by freight transport insurance specialist TT Club in its current country-by-country market analysis of the region, Transport and Logistics Market Opportunities.

The Club’s Senior Underwriter, Dan Negron presented the findings at a transport industry forum at the beginning of the month.  “Two examples of robust economies are Colombia and Peru.  The latter has grown its export trade by a multiple of five over the last decade, while Colombia has a sustained GDP growth rate in the region of 5% in recent years.  Both have burgeoning middle classes, a significant driver of international trade,” explained Negron.

Such economic growth is one of four factors pin-pointed in TT’s analysis; the other three being government policies, improved connectivity and distribution channels.  It is clear that a number of government policies, particularly the privatisation of ports and free trade agreements are significant in terms of increasing trade.  Negron reported however that the need for greater investment in domestic infrastructure to improve transport connectivity within the region, and a need for logistics supply chain services to be more organised, were in danger of frustrating trade growth in reaching its full potential.

While Latin American ports are themselves becoming increasingly better organised, the infrastructure used to move goods to and from the inland production and consumption locations have not been modernised at an equivalent pace.  “In addition to this need for capital investment to improve connectivity,” said Negron “very often the functions of warehousing, trucking, cargo consolidation and other related services are performed by individual operators or by shippers themselves.  Systems therefore tend not to be fully-integrated and the efficiencies of a cohesive supply chain can’t be realised.”

TT Club itself is a stakeholder in the success of efficient supply chains, benefiting along with its Members in the reduction of risk that such efficiencies bring. Increased volumes of trade will result from improved connectivity and better integrated distribution channels.  The Club is committed to improving trade opportunities in Latin America and aiding transport operators in their development.

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*Scotia Bank – Regional Outlook 2013

Note to Editors:

The TT Club is the international transport and logistics industry’s leading provider of insurance and related risk management services. Established in 1968, the Club’s membership comprises ship operators, ports and terminals, road, rail and airfreight operators, logistics companies and container lessors. As a mutual insurer, the Club exists to provide its policyholders with benefits, which include specialist underwriting expertise, a world-wide office network providing claims management services, and first class risk management and loss prevention advice.