London, 12 December 2005 – Shipping and cargo companies transporting goods and passengers around the world need to be more aware of their role in the possible spread of a flu pandemic, warns Aon Limited, a leading insurance broker and risk management consultant. This is one of the issues highlighted in Aon’s Marine Insurance Market Review*, launched today.
Recent cases of ships being detained in the port of Piraeus and another in Malta due to dead birds -potentially carrying the strain - being found on deck demonstrate the concerns held over the ease at which the shipping industry can become involved in the transmission of infectious diseases.
According to the World Health Organisation (WHO), one hundred outbreaks of contagious diseases were reported to be associated with ships between 1970 and 2000. Naval, cargo and cruise vessels have all been affected often with serious financial and operational consequences.
Despite the severity of a human form of avian flu having not yet been fully realised in Europe, ships need to be cautious of their potential exposure to birds carrying the disease that fly along the routes they travel. The migratory tendencies of birds and their ability to perch on the decks of ships put both cargo and crews at risk. This risk is compounded by the isolated, crowded living accommodation shared by seafarers and their sharing of common food and water supplies.
Lessons can be learnt from the spread of cholera pandemics in the nineteenth century which was linked to trade routes and facilitated by merchant shipping. Efforts to control human disease on ships can be traced back to 1377, when the ports of Venice and Rhodes denied access to ships carrying passengers infected with the plague and the term “quarantine” was coined.
Instances of ships being impounded have severe implications for business interruption costs. Currently, aside from life assurance and sickness cover, insurance markets offer little protection for loss of business revenue as a result of a pandemic, pushing the need for robust business continuity planning to the top of the company board agenda.
Steve Allum, chairman of Marine Global Practice Group, said: “The threat of a flu pandemic and the associated economic and social costs are very real. Aon’s recent pandemic survey found that that more than eight in 10 (85.5%) companies view a possible influenza pandemic as a threat to their business, yet fewer than six in 10 (57%) have put measures in place to protect themselves against such a risk. Companies operating in the marine sector can play an integral role in preventing the spread of a flu pandemic and therefore need to take precautions whilst carrying out their everyday business.”
“Generally, property and marine policies where business interruption and extra expense are typically covered exclude losses resulting from damage due to the spread of infectious diseases. However, there are policies that can provide cover, and the current focus on avian flu should provide an opportunity, both for underwriters offering these solutions, and for shipping companies concerned about the issue to protect their cash flow and reputation.”
Survey Methodology
Aon surveyed over 200 businesses and public sector organisations, representing a wide range of industries and activities with annual turnover or budget ranging from less than £50 million to more than £500 million, via a web-based questionnaire. The research was conducted between 25 October and 4 November 2005.
CommunicateResearch surveyed 150 MPs between 12 and 28 October 2005 using self-completion questionnaires (77 Labour, 48 Conservatives and 25 from the smaller parties). Data were weighted to the exact composition of the House of Commons. CommunicateResearch is a member of the British Polling Council and abides by its rules (www.britishpollingcouncil.org).
About Aon
Aon Corporation (www.aon.com ) is a leading provider of risk management services, insurance and reinsurance brokerage, human capital and management consulting, and specialty insurance underwriting. The company employs approximately 53,000 professionals in its 600 offices in more than 120 countries. Backed by broad resources, industry knowledge and technical expertise, Aon professionals help a wide range of clients develop effective risk management and workforce productivity solutions.
This press release contains certain statements relating to future results, which are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from either historical or anticipated results, depending on a variety of factors. Potential factors that could impact results include the general economic conditions in different countries around the world, fluctuations in global equity and fixed income markets, exchange rates, rating agency actions, pension funding, ultimate paid claims may be different from actuarial estimates and actuarial estimates may change over time, changes in commercial property and casualty markets and commercial premium rates, the competitive environment, the actual costs of resolution of contingent liabilities and other loss contingencies, the heightened level of potential errors and omissions liability arising from placements of complex policies and sophisticated reinsurance arrangements in an insurance market in which insurer reserves are under pressure, and the timing and resolution of related insurance and reinsurance issues relating to the events of September 11, 2001. Further information concerning the Company and its business, including factors that potentially could materially affect the Company's financial results, are contained in the Company's filings with the Securities and Exchange Commission.
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