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Insurance for Solar 1 hits snag (aka Aray Guimaras part 2)

September 6, 2006

OWNERS of the M/T Solar 1 oil tanker could face problems in paying off claimants of the Guimaras oil spill due to possible rejection of their insurance claims, TV Patrol World reported Wednesday.

Stronghold Insurance Company Inc. (SICI) cancelled the hull and machineries insurance policy of Solar 1 after the tanker’s owners, Sunshine Maritime Development Corp. (SMDC), failed to settle the premium.

Another insurance firm based in Luxembourg could also refuse insurance worth $300 million after the ship’s owners allowed an unlicensed captain to man the vessel.

Solar 1, carrying at least two million liters of oil, sank off Guimaras Islands last August 11. Officials said the oil spill had polluted at least 220 kilometers of coastline, fishing grounds, marine reserves and tourist spots.

Hundreds of fishermen in the island were deprived of their livelihood because of the oil spill and hundreds of Guimaras residents were hauled to evacuation centers to avoid the toxic hazards brought by the spilled oil.

(Click Insurance snag, Sept. 6, 2006, for the full story.)

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