Skip to main content
The Actuary: The magazine of the Institute and Faculty of Actuaries - return to the homepage Logo of The Actuary website
  • Search
  • Visit The Actuary Magazine on Facebook
  • Visit The Actuary Magazine on LinkedIn
  • Visit @TheActuaryMag on Twitter
Visit the website of the Institute and Faculty of Actuaries Logo of the Institute and Faculty of Actuaries

Main navigation

  • News
  • Features
    • General Features
    • Interviews
    • Students
    • Opinion
  • Topics
  • Knowledge
    • Business Skills
    • Careers
    • Events
    • Predictions by The Actuary
    • Whitepapers
    • Moody's - Climate Risk Insurers series
    • Webinars
    • Podcasts
  • Jobs
  • IFoA
    • CEO Comment
    • IFoA News
    • People & Social News
    • President Comment
  • Archive
Quick links:
  • Home
  • The Actuary Issues
  • June 2022
General Features

United front: responding to large loss events

Open-access content Wednesday 1st June 2022
Authors
Darshan Purmessur

Darshan Purmessur shares how public and private sector stakeholders came together following the 2020 Mauritian oil spill, and what it can teach us about responding to large loss events

yukf

Events such as pandemics, wars, financial crises, and natural catastrophes and environmental disasters test governments’ ability to help people deal with periods of commotion, unrest and economic downturns. The past two years have shown how governments’ responses and interventions have been instrumental in supporting their people and bolstering their economies. In recent times, environmental disasters have become costlier and deadlier. Governments need to engage with not just each other to adhere to and implement environmental, social and governance pledges, but also local companies and communities to help them build back better after an event.

resizedPicture_WK.jpg

 

A Mauritian example

Crude oil is the backbone of industrialised economies worldwide, and more than half of it is transported by sea. In 2020, on top of the COVID-19 pandemic, Mauritius faced a serious environmental disaster: the Japanese ship carrier MV Wakashio ran aground on a coral reef on 25 July 2020, and started leaking on 6 August. By 10 August, around 1,000 metric tonnes of fuel had been spilt. The ship broke up on 15 August while still containing 166 tonnes of fuel.

Various countries, including the UK, Japan, France and India, offered help, sending technical equipment and material to help contain the oil spill. The local population also joined in, making cloth barriers stuffed with straw and human hair – donated by locals – to mop up the oil, and keeping them afloat with plastic bottles. Businesses such as grocery stores provided equipment to transport filled barrels of oil from the shores. Mauritian insurer Eagle Insurance insured one of the vessels that was removing and transporting oil; it rapidly engaged with its Hull and Machinery reinsurers and P&I club to obtain the go-ahead.

 

ugli

Aftermath and intervention

By early November, all crude oil had been removed from Mauritius’s shores. Laboratory analysis was carried out on the fish around the lagoon, and it was concluded that they had high concentrations of cancer-causing chemicals. In addition, more than 52 dolphins and whales were found dead on the shore soon after the oil spill. No scientific publications have yet been released concerning the devastating impact of the oil spill. However, environmental specialists believe that this event was the worst oil spill ever to take place off the Mauritian coast.

The Mauritian government launched an e-platform in August 2020 to facilitate the submission of claims after issuing a communiqué that the state holds the ship owner and its insurer liable, and issued guidelines for claim categories and admissibility. Any person or entity that suffered was invited to submit a claim under defined categories.

Mauritius requested compensation in line with the International Convention on Civil Liability for Bunker Oil Pollution Damage.

The ship carrier, Wakashio, is insured up to US$1m by the London-based International Group of Protection & Indemnity (PI) club, of which Japan PI is a member. The group is protected by more than 50 reinsurance counterparties, including large reinsurers such as Swiss Re and Allianz.

In December 2021, Mauritius’s Minister for the Blue Economy, Marine Resources, Fisheries and Shipping confirmed that the Japan PI club will provide 112,000 Mauritian rupees (Rs) each to some 825 fishermen and 174 fishmongers to compensate for the earnings they lost as a result of the spill. This amount was determined by calculating the daily income of fishermen based on their daily catch, which turned out to be roughly Rs27,000 over the last three years. In addition, the captain and co-captain were found guilty of “endangering safe navigation” and sentenced to 20 months in jail.

The Mauritian Government also requested that all fishing vessels increase their limit of liability regarding towage, pollution and wreck removal for a minimum of Rs25m to renew their annual licence.

resizedIMG_0862.jpg

Working together

The Wakashio incident is a good lesson about how all members of society can prepare for disastrous events. It was remarkable to see the whole population working together to help contain the oil spill, and countries across the globe helping Mauritius and its ecosystem. Governments, in particular, can play a key role in pinpointing accountability, ensuring timely compensation for a local community’s losses, and taking action on lessons learnt.

Darshan Purmessur is a senior actuarial consultant at QED Actuaries and Consultants

Image credit | Getty

Linked ACT Jun22_Full LR.jpg
This article appeared in our June 2022 issue of The Actuary .
Click here to view this issue

You may also be interested in...

ees

Reversing the decline: understanding nature-related risks

Oliver Schelske places nature-related risks within an actuarial context, and explains why it is so important for insurers to understand such risks
Wednesday 1st June 2022
Open-access content
z

Changing gears: autonomous vehicles and motor insurance

Ben Hoster considers the implications of electric autonomous vehicles for motor insurance, and the role insurers will play in popularising this new mode of transport
Wednesday 1st June 2022
Open-access content
hrts

Storm watch: Can IPCC models be used in cat modelling?

Can IPCC projections be used to adjust catastrophe models for climate change? Nigel Winspear and David Maneval investigate, using US hurricanes as an example
Wednesday 1st June 2022
Open-access content
ya

Regulation: The pursuit of harmony

Ahead of an expected European Commission investigation, Pieter Bouwknegt, Danny Dieleman and René Doff set out how mortgages are treated differently under European banking and insurance frameworks
Wednesday 4th May 2022
Open-access content
hrrz

The social movement

The actuarial profession needs to pay more attention to social risk, says Chris Sutton
Wednesday 4th May 2022
Open-access content
tr

A shock to the system: reforming UK energy supplier regulation

Gemma Gregson and Stav Tsielepis consider how to reform UK energy supplier regulation
Wednesday 4th May 2022
Open-access content

Latest from Risk & ERM

KV

Liability-driven investments: new landscape

What now for liability-driven investments, after last year’s crash in the market? Pensions experts Rakesh Girdharlal and Moiz Khan say it should lead to a more balanced approach
Wednesday 1st February 2023
Open-access content
cj

Natural capital investing

Chris Howells and Andrew Dreaneen discuss how today’s investments in natural capital profit portfolios as well as the planet and humanity
Wednesday 1st February 2023
Open-access content
bl

'Takaful' models of Islamic insurance

Ethical, varied and a growing market – ‘takaful’ Islamic insurance is worth knowing about, wherever you’re from and whatever your beliefs, says Ali Asghar Bhuriwala
Wednesday 1st February 2023
Open-access content

Latest from General Insurance

td

Brain power

The latest microchips mimic cerebral function. Smaller, faster and more efficient than their predecessors, they have the potential to save lives and help insurers, argues Amarnath Suggu
Wednesday 1st March 2023
Open-access content
bl

'Takaful' models of Islamic insurance

Ethical, varied and a growing market – ‘takaful’ Islamic insurance is worth knowing about, wherever you’re from and whatever your beliefs, says Ali Asghar Bhuriwala
Wednesday 1st February 2023
Open-access content
il

When 'human' isn't female

It was only last year that the first anatomically correct female crash test dummy was created. With so much data still based on the male perspective, are we truly meeting all consumer needs? Adél Drew discusses her thoughts, based on the book Invisible Women by Caroline Criado Perez
Wednesday 1st February 2023
Open-access content

Latest from Environment

rdth

Make My Money Matter's Tony Burdon on the practical power of sustainable pensions

Years working in international development showed Tony Burdon, head of Make My Money Matter, that sustainable pensions can harness trillions of pounds to build a better world – at a scale governments and charities can’t. He talks to Travis Elsum
Wednesday 1st March 2023
Open-access content
ty

Data detective

Heard about the chatbot ChatGPT? Artificial intelligence is advancing rapidly, says Arjun Brara – and could soon be used to refine ESG ratings and expose greenwashing
Wednesday 1st March 2023
Open-access content
iugu

Interview: chemist and climate expert Sir David King on how actuaries can save the Arctic

Actuaries can save the Arctic, according to esteemed chemist and climate-change expert Sir David King. He tells Alex Martin that risk management is as relevant to preserving the planet as groundbreaking science
Wednesday 1st February 2023
Open-access content

Latest from General Features

yguk

Is anybody out there?

There’s no point speaking if no one hears you. Effective communication starts with silence – this is the understated art of listening, says Tan Suee Chieh
Thursday 2nd March 2023
Open-access content
ers

By halves

Reducing the pensions gap between men and women is a work in progress – and there’s still a long way to go, with women retiring on 50% less than men, says Alexandra Miles
Thursday 2nd March 2023
Open-access content
web_Question-mark-lightbulbs_credit_iStock-1348235111.png

Figuring it out

Psychologist Wendy Johnson recalls how qualifying as an actuary and running her own consultancy in the US allowed her to overcome shyness and gave her essential skills for life
Wednesday 1st March 2023
Open-access content

Latest from Darshan Purmessur

Far-reaching crisis

Far-reaching crisis

Darshan Purmessur
Wednesday 4th November 2020
Open-access content

Latest from June 2022

k

Sponsored roundtable: Meeting the data demand

Emerging data science tools and techniques are redefining what it is to be an actuary. Organisations worldwide are looking to optimise their operations , and recruitment agencies are inundated with requests for talent that stands out from the crowd.
Wednesday 1st June 2022
Open-access content
hg

Filling the gap: actuarial resources between nations

Ibrahim Muhanna looks at the state of the actuarial profession around the world, and considers what it might take to narrow the gaps in resources
Wednesday 1st June 2022
Open-access content
Puzzles-iStock-1146577830.jpg

Puzzles June 2022

The June puzzles and the solutions are viewable in PDF format only.
Wednesday 1st June 2022
Open-access content
Share
  • Twitter
  • Facebook
  • Linked in
  • Mail
  • Print

Latest Jobs

Senior Manager - Building new team!

London (Central)
Up to £130k + Bonus
Reference
148845

Shape the Future of Credit Risk Model Development

Flexible / hybrid with 2 days p/w office-based
£ six figure salary with excellent bonus potential + package
Reference
148843

Longevity Director

Flexible / hybrid with 2 days p/w office-based
£ six figure salary with excellent bonus potential + package
Reference
148842
See all jobs »
 
 
 
 

Sign up to our newsletter

News, jobs and updates

Sign up

Subscribe to The Actuary

Receive the print edition straight to your door

Subscribe
Spread-iPad-slantB-june.png

Topics

  • Data Science
  • Investment
  • Risk & ERM
  • Pensions
  • Environment
  • Soft skills
  • General Insurance
  • Regulation Standards
  • Health care
  • Technology
  • Reinsurance
  • Global
  • Life insurance
​
FOLLOW US
The Actuary on LinkedIn
@TheActuaryMag on Twitter
Facebook: The Actuary Magazine
CONTACT US
The Actuary
Tel: (+44) 020 7880 6200
​

IFoA

About IFoA
Become an actuary
IFoA Events
About membership

Information

Privacy Policy
Terms & Conditions
Cookie Policy
Think Green

Get in touch

Contact us
Advertise with us
Subscribe to The Actuary Magazine
Contribute

The Actuary Jobs

Actuarial job search
Pensions jobs
General insurance jobs
Solvency II jobs

© 2023 The Actuary. The Actuary is published on behalf of the Institute and Faculty of Actuaries by Redactive Publishing Limited. All rights reserved. Reproduction of any part is not allowed without written permission.

Redactive Media Group Ltd, 71-75 Shelton Street, London WC2H 9JQ