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Piracy is an insurance risk with no foreseeable resolution

David Abbott

Corporate Finance

| March 16th 2010

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Piracy is an insurance risk with no foreseeable resolution

Simon Fordham, a Partner and crisis management expert from BGN Risk, said this week that insurers were used to hard-nosed negotiation but that this did not work with pirates in Somalia, Nigeria and elsewhere. In a lecture from the Insurance Institute of London's podium at Lloyd's Old Library, Fordham said that pirate activity did not conform to set patterns and was mostly outside ship-owners' control.

"The pirates will show how much control they have, and the lives of the crew could be in danger."

Fordham said that piracy was indisputably a "crisis" and that there was no sign of resolution or impact reduction for some time. He spent the rest of the lecture explaining to the insurance industry delegates the desperate and culturally entrenched nature of this emerging risk.

"The pirates carry weapons as easily as we Europeans wear a watch. If the pirates come within 800 meters of a ship, they do their damnedest to get it."

The average age expectation of a man in Somalia was 40, which meant that at 16, 17 or 18-years-old...

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David Abbott

About the author

David Abbott

Partner

Meet our Team of Experts

David joined Begbies Traynor in 2004 originally working in one of their regional offices.  In 2006 he moved to the London office to help set up a specialist team focusing on creditor side assignments in the guise of Independent Business Reviews and Independent Solvency Reviews.  David has 18 years’ experience in the accounting profession and prior to joining Begbies Traynor has worked in a number of Top 50 London based partnerships.

As well as business reviews and independent solvency reviews, hands on turnaround assignments have also been one of David’s main focuses. This has generally been in support of high street clearing banks.

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