MLC Requirements on Financial Security and Shipping Practice

The majority of shipowners’ liability, including their liability for seafarers’ claims, is insured by protection and indemnity (P&I) insurance, obtained through P&I clubs—mutual insurance societies whereby the members (shipowners) insure one another on an indemnity basis for a variety of third-party liabilities relating to the use and operation of ships. Liability cover (protection and indemnity) for approximately 90 per cent of the world’s ocean-going tonnage is provided by an international group of P&I clubs, the unincorporated association of the 13 principal underwriting associations (clubs) and their affiliated associations and reinsured entity.