Insurers pay $920 million pesos for damages to vessels after Otis

The insurance industry has paid 920 million pesos in indemnities to boats in Acapulco, according to data from the Mexican Association of Insurance Institutions (AMIS). AMIS has ranked Otis as the third most expensive event in history, only behind Wilma, which in 2005 hit the Mexican Caribbean, and the Covid-19 pandemic.

The hurricane's passage and the dragging of vessels have brought pollution issues to the table, as well as the dragging of ships that sank. The Secretary of the Navy established protocols for the search of people and the official figure was more than 50 people dead. Once the Navy finishes the search for people, the search and rescue of ships begins, explains Carlos Jiménez, Director of Damages and Automobiles of the Mexican Association of Insurance Institutions (AMIS) in an interview. "They are the ones who open areas that can be explored and have to prioritize the integrity and search for people under very careful protocols," he said. To recover these vessels a kind of aquatic cranes are required when there is sinking, although there are other vessels that crashed and the coverage works in a similar way to cars. Until the end of last year, AMIS had a record of 12,905 insured boats and 915 were in Guerrero. The state is the fifth with the highest number of insured boats, behind Quintana Roo, Baja California Sur, Jalisco and Sonora. After the passage of Otis, insurers have compensated 211 vessels affected by the hurricane for an amount of almost 920 million pesos. The average cost being paid by the industry per vessel is 4.3 million pesos on average. Marine insurance, as this type of insurance is also known, protects against risks such as damage to the pier, damage to passengers (which is similar to liability insurance for automobiles), and hurricane insurance, as was the case with Otis.

What is needed to insure a boat? The insurers that offer this type of insurance require the owners to have valid documents to navigate in Mexican waters, serial number, number of engines and capacity of people on board. Boat owners are required to comply with the instructions of the authorities in case of a hurricane warning and to notify the insurer as soon as possible when a loss or damage occurs. Oscar Pineda, Technical Executive Director of Mapfre Mexico, explained that in case of hurricanes such as Otis, the owner of the boat has to look for it and in case of sinking, the insurer helps to find a company that will help to pull it out of the water. The insurer gives the affected person a sum of money to help pay for part of what the water tow truck charges. By law, the affected person cannot take more than two years to claim his damage and that is why it is recommended that the papers of the boats are always in a safe place. What do these insurances cover? Mapfre data indicate that, depending on the policies and companies, "perils of the seas, rivers, lakes or other navigable waters" are covered. In the event that the vessel is a sailboat, damage or loss to masts, sails, protective covers and rigging caused by the action of wind and water, or any other atmospheric phenomenon, are not covered. Also covered are perils such as fire (both afloat and ashore), capsizing due to damage, piracy and collision with dock or port equipment or installations, aircraft and objects falling therefrom. Coverage includes earthquakes, volcanic eruptions or lightning, as well as total theft.