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Yacht Insurance Problems - Continued

UNBELIEVABLE but true! It is now more than 15 months after we were struck by lightning and our insurance claim is still not settled! You can read previous posts of all the problems we encountered with this rubbish insurance company. We received a 3 month visa when we checked into Trinidad & Tobago and due to the extensive delays in the insurance company settling this matter, we had no choice but to suspend our world cruise and return to South Africa. Neither can we move the yacht to another country as the damage sustained in the lightning strike rendered the yacht not to be seaworthy anymore.

With the yacht in Trinidad, we in South Africa, our plans are in a mess and we are incurring big expenses due to all this bullshit. Whilst we are paying marina fees in Trinidad, we also have to pay for local accomodation and have been renting a vehicle for the past 13 months.

In addition to other problems (some mentioned in previous posts), the insurance company is trying to squeeze their obligated pay out to the bare minimum. They are trying to undercut every single legitimate expense. They offer about 35% of the actual labour fee to repair the yacht. Despite stalling for almost the entire time, they refuse to pay the marina fees we had to pay in the interim. They do not want to pay for new equipment which were complete destroyed - instead, they want to pay a repair fee. This includes a sail which was lost at sea! How the hell do you repair something which no longer exist? So they keep stalling and stalling - obviously trying to wear us down and apply pressure on us to accept their paltry pay out.

Our attorneys have been dealing with them for the past 4 months and has made some progress but we are still too far apart. If we do not sort out this mess within the next month or so, we will have no choice but to issue summons to Mutual & Federal and AIB Insurance Brokers.


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Yacht Insurance Problems

For many years prior to going on our world cruise, we did not have any insurance on Revelations. This stemmed from calculations we made which showed that it would be more economical for us not to insure the yacht and that it would financially be better for us to pay for any mishaps or possible damages to the yacht. Having done that for around 5 years, weighing up the costs (what insurance would have cost us versus the actual money spend on damages), we were right. It was around 30% cheaper for us not to insure Revelations.

With our imminent world cruise, we again looked at the various risk factors and also the cost of possible repairs in a foreign country which will have to be paid in US Dollars. This is a massively complex situation, with millions of variables and unknowns, also that it is impossible to even remotely arrived at any accurate calculation - this time around, we decided to take out adequate insurance on Revelations. We finally signed up with AIB, an insurance company in Cape Town, South Africa. We received great service, a good and fair insurance policy and all our questions were promptly answered.

Fast forward many months later. On one gloomy dark night, sailing from French Guyana to Trinidad, we were struck by lightning (see previous blog postings). We sustained a lot of damage as most of the electric and electronic equipment were knocked out. Using backup systems, we limped along to Trinidad at which time we made contact with our insurance company advising them of the situation. Once again, we received friendly efficient service and we were advised that an assessor will be appointed who will contact us. We were told to start getting quotes from suppliers/contractors for the repair and replacement of the defective goods.

Within days, Mr. Dave Miller from D.W. Miller & Associates, Durban, South Africa made contact with us regarding our insurance claim. He requested that that we source the names of a couple of marine assessors in Trinidad and that he, Mr. Miller will then liaise with the Trinidad assessor to inspect the yacht.


After about a week or so, Mr. Robert Ferreira from Robard Marine Recovery Services, 48 New Street, Port Of Spain, Trinidad and Tobago was appointed as the Trinidad surveyor and he made contact with us to meet and inspect the damage. We met on board Revelations and our meeting was friendly and cordial. We discussed the extensive list of equipment which was damaged whilst Mr. Ferreira took pictures and made notes. He also asked that we obtain quotations from various suppliers and contractors and that this should be forwarded to him.

Throughout the next two weeks we obtained quotes from a number of contractors and suppliers - all of which was forwarded to Robert Ferreira. Seemingly Mr. Ferreira was a layman himself for he in-turn appointed so-called experts to come and look at the various damaged items on board Revelations. This is where things started going badly wrong resulting is a long drawn out and unsettled claim with every possibility of legal action against the insurance company.

Mr. Miller, taking instructions and guidance from Ferreira, have in the interim made proposals to settle the claim. However, this settlement is fraud with mistakes and only accounts for about 35% of the damage sustained. We have refused his settlement offer and have since employed the services of our attorneys in this matter

Here are the remaining issues and disputes;

Water maker
After the lightening strike, there were numerous electronic functions of the water maker which no longer worked. These functions and problems have all been detailed in several communications to both Ferreira and Miller. Ferreira and his so-called "experts" could not have properly tested the water maker as the yacht needs to be in the water. His expert looked at the water maker whilst the yacht was (and still is) on dry land.

The water maker was manufactured by Aqua Marine in Cape Town, South Africa and they are willing to look at the machine with the view to repair. However, Aqua Marine is unable to provide a repair quote unless they have the machine in their Cape Town workshop for assessment. The water maker is a large machine weighing around 200 kilograms and the shipping cost from Trinidad to Cape Town and back to Trinidad exceeds R50,000.

There is a company called Echo-Marine Ltd. based in Trinidad who manufactures their own brand of water makers. However, they are not at all willing to work or repair any machine which is not theirs. There is no other company in Trinidad capable of working on the water maker and it is for this reason why all the quotes received made provision for a new water maker machine. Miller's settlement offer does not make any allowance for a new water maker nor any repair cost to the existing water maker - replacement cost is in excess of R150,000.

Asymmetrical spinnaker
When the lightning bolt struck Revelations, the entire asymmetrical spinnaker sail "exploded" into many pieces. The result was a entangled mess of torn cloth and rope. Most of this ended up in the water below the yacht entangled around the keels and even as far back as the rudders. We could not salvage the sail and with knives we cut most of this tangled mess away which was abandoned at sea. All that remained of the entire spinnaker was a few pieces of badly torn cloth which we stowed away. Ferreira was informed that we abandoned the sail at sea - to this day he has never seen the sail nor any of the remaining pieces of sail cloth. He therefore did not inspect the sail in any manner what-so-ever. Knowing that the spinnaker no longer existed, his report to Miller was for the repair of the this non existent spinnaker and not it's replacement. Millers settlement offer therefore compensated only about 15% of the actual replacement cost! After arguing this issue, Miller has since revised his settlement offer which now includes the replacement cost for a new spinnaker. Although this issue is no longer in dispute, it is worth mentioning this as it is indicative of Ferreirra's sloppy work and lack of proper inspection of the damaged items.

Fleet Broadband Sailor 250 satellite phone
The satellite phone system consists of two main components – antenna dome on the mast and the below deck terminal. Like the TV antenna fixed to the mast, the satellite antenna dome was blown to pieces by the lightning strike, is completely beyond repair and only the metal structure remains. Ferreira and his expert saw the physical damage and both agreed the the antenna dome needs replacing. Ferreira's expert who looked at the complete unit, claimed that the below deck terminal worked after taking it to his workshop. However, when he brought the below deck terminal back to the yacht, I challenged him to show me that the unit work and he could not do so – even after repeated attempts and efforts. The terminal did not even power up! It was as dead as a door nail! Despite this, as witnessed by the assessor’s expert himself, Ferreira and Miller maintains that the unit is working perfectly and refused to make any compensation for this. Replacement cost is in excess of R90,000.

Air conditioner
Prior to the lightning strike, the main central air conditioner unit and all the water cooling units located around the yacht worked perfectly – all of this no longer worked after the lightning strike. The central air conditioner pumps sea water through its cooling mechanism which is thereafter again pumped overboard. Ferreira had somebody look at the air conditioner in my absence and whilst the yacht was on dry land. However, it is impossible to have tested the air conditioner as it needs to be in the water for it to work. Due to sensors within the machine, it cannot be started unless there is coolant sea water available! It is therefore impossible that the entire air conditioning system could have been checked! Miller's settlement offer does not make any allowance for the air conditioner. Replacement cost is in excess of R250,000.

Furuno NavNet v2 Chart Plotter
After the lightning strike, working for around 60 minutes and longer, when the unit has properly warmed up – it then starts flickering on a regular basis. The screen will flash blindingly white for a split second every minute or so and this is extremely discomforting and dangerous. When the screen flashes white, one is completely blinded until one’s eyes again adjust to the dark of the night. One’s eyes are hardly adjusted when the screen flashes white yet again. The chart plotter is vital and critical piece of navigation and safety equipment upon which all the navigation information, AIS and radar imaging are displayed. Whilst sailing, the skipper stands in front of the chart plotter and monitors it on a continuous basis – only to be continuously blinded. Extremely dangerous at night!!!!

The so-called expert appointed by Ferreira barely looked at the chart plotter and was EXTREMELY dismissive of the problem. Probably pissed off that he was not invited to quote for the repairs. Despite clearly hearing that the problem start after the unit has properly warmed up, he switched on the unit, looked at it for about 20 seconds and declared that it was working! That's it?!

A new problem has developed since my dispute started with Mr. Miller. The Furuno NavNet v2 Chartplotter is no longer available as they have now discontinued this product. They do have an alternative product but the dimensions are different. The newer model is smaller and this means that it will not fit into the cut out cavity of the existing chart plotter. To make it fit, fibreglass work is now require and extensive refinishing/paint work is required. Miller's settlement offer does not make any allowance for the chart plotter. Replacement cost is in excess of R80,000.

Handheld Icom Radio
Despite reporting that the handheld radio was not working, despite submitting quotations to replace the radio – the assessor completely ignored the radio. Miller's settlement offer does not make any allowance for the Icom handheld radio. Replacement cost is around R5000.

Hella Marine LED Navigation lights
Despite reporting that the LED navigation lights (4 lights in total – port, starboard, aft and steaming lights) were damaged and not working, despite submitting quotations to replace the navigation lights – Ferreira once again choose to completely ignored the navigation lights. The navigation lights were less than 18 months old at the time of the lightening strike - which lights are guaranteed to work for over 30,000 hours. We probably used the navigation lights for around 600 hours only. These lights are NOT cheap! Miller's settlement offer does not make any allowance for the navigation lights. Replacement cost is around R11,000.

The above are the outstanding issues and which is my dispute with the settlement offer made by Miller representing AIB Insurance. The claim was submitted during October 2015 and as of date, it is still not settled in any which way or manner. I’ve written numerous emails during and after the inspections to Ferreira, Miller and AIB about the above issues. Whilst AIB remain friendly and helpful, they are guided by Miller's recommendations. Miller continues to stonewall and despite overwhelming evidence that Ferreirra did a terrible job inspecting and assessing the damage, he refuses to consider/acknowledge that there is a problem. An expensive problem which needs sorting out! AIB needs to accept responsibility for their appointed assessor. In view of this, it is impossible for me to recommend AIB as your marine insurance company.

AIB - Associated Insurance Brokers (Cape) 2006 (Pty) Ltd.
Glacier Place, 1 Sportica Crescent,
Tyger Valley, Cape Town,
South Africa.

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