Costa Concordia: what comes next? Slides from the Lloyd's List Costa Conccordia webinar held on 27th January. Webinar contents - •Casualty trends at Costa Concordia and the cruise sector •Who lies behind the corporate veil •The entities behind the Costa brand name •What the vessel movements data tells us •What lies ahead on the story

2. On the call today
Adam Smallman, Head of Content
Wally Mandryk, Market Intelligence Manager
David Osler, Industrial Editor

3. In the next 40 minutes we’ll…
• Probe vessel’s movements
• Compare the movements with others
• Understand casualties patterns
• See complex ownership
• Gauge salvage, legislation implications
• Hear how Lloyd’s List will cover it next
• Take questions

4. Our information
• Lloyd’s List editorial team
• Lloyd’s List Intelligence data, analysis
• Unique use of AIS stations+Lloyd’s
agents+satellite
• Land-based stations used in Concordia case
• Casualties data from our 24/7 alerting service
• Analysis done by Wally, colleagues, journalists

5. Concordia’s movements
• The fateful voyage
• Comparison to similar visit in August last year
• Other Costa Crociere vessels movements near
Giglio
• Previous Concordia voyages in the region
• Other cruise ship movements in the region

6. Vessel Movements

7. Vessel Movements

8. Vessel Movements

9. Vessel Movements

10. Vessel Movements

11. Vessel Movements

12. Movements Summary
• Costa unusual in its vessels’ proximity to the island
versus other operators
• But Concordia more frequent than other Costa
vessels
• Summer voyage last year looks pre-determined
toward Giglio
• Jan 13 voyage shows far later turn-in toward Giglio

13. Casualties Backgrounder
• Annually, some 60 cruise vessels out of 500-strong
fleet involved in casualties
• Navigation incidents remain relatively high last year,
though equipment failures fell sharply
• Around 40% of cruise sector casualties feature
vessels less than 10 years old – a surprise
• Almost two-thirds involved in casualty were flagged
with open registries (so-called ‘flags of convenience’)

14. Casualties Backgrounder
• Navigation issues largest contributor to lives lost
• External events (weather, piracy) a minority of incidents
• Majority, including fatalities, occur on largest vessels
(+40,000GT)
Wally Mandryk, Market Intelligence Manager

15. Casualties Backgrounder

16. Casualties Backgrounder

17. Casualties by company
• Carnival, Royal Caribbean account for half of casualties but have
fleet share sub-30%
• Pre-Concordia, 11 cruise ship fatalities since ’06 on seven vessels
• But only two due to grounding
• Including Concordia, half the eight vessels beneficially owned by
Carnival
• All were classed by respected International Association of
Classification Societies
Wally Mandryk, Market Intelligence Manager

18. Ownership backgrounder
• Complex vessel/company linkages exist within
maritime
• If analysing casualty and trend information it
is important to view incidents within the
relevant ownership structures
• Ownership structures in the Concordia case
are best understood by visual representation

19. Ownership

20. Insurance exposures
• RSA surveyors not yet on board
• Total loss or recovery decision on $550M vessel some
way off
• Carpet alone valued at $4M
• P&I exposure may be as high as $1B, with ~$100M for
wreck recovery
• U.S. class action may drive up costs
• Regional impact (Tunisia proximity, others) may lift
exposure
• Will hull/machinery market harden?

21. Insurance exposures
• Carnival P&I coverage somewhat unusual
• Has ‘excess’ of $10M before P&I involvement
• Then it’s split between Standard Club and Steamship
Mutual (liable for $4M-a-piece before International Club)
• International Club has $3.06B of coverage
• If liability claims pass through $60M – likely? -
International’s excess of loss reinsurance triggered
• Total loss will hit P&I with wreck removal. Scrapped?
• Carnival, other cruise firms costs to rise

22. Legislation Backgrounder
• 1912: Titanic spelt Safety of Life at Sea convention
• 1987: Herald of Free Enterprise saw adoption of Safety of
Life at Sea amendments and new rules on ferry stability
• 1989: Exxon Valdez oil spill resulted in Oil Pollution Act
1990
• 1999: Erika sinking propelled EU-wide ban on single-hull
tankers
David Osler, Industrial Editor

23. Legislation Outlook
• US House Transportation and Infrastructure
Committee hearing launches next month
• Italian government
• E.U.
• International Maritime Organization confirms Costa
Concordia investigation findings to be eventually
considered
David Osler, Industrial Editor

24. Legislation Focus?
• Stability standards
• Technical specifications
• Management procedures
• Lifeboat provision and release times
• Safety training of hotel staff
• Timing of safety briefings
• Proscription on sailing close to shore
David Osler, Industrial Editor

25. What Lloyd’s List will cover next
• Carnival strategy: damage limitation, payout implications, the
Costa brand
• Passenger ship safety standards, regulatory backlash, cost to
industry
• Insurers to reconsider their attitude to cruise ship risk?
• Legal: flag state developments, criminal investigations, class
actions, legal precedents
• Size rethink: changes to salvage, safety procedures and even
willingness to opt for giant vessels
•

26. Need to know more?
In the U.S? Speak with David Pender to get Lloyd’s List on your iPhone, iPad,
desktop and e-mail
davidpender@informausa.com +1 (212) 652 5332
In Europe, Chris Rowe will help
chris.rowe@informa.com +44 (20) 701 74187
In the U.S.? For movements data, analysis & insight from Lloyd’s List
Intelligence, speak with Brad Browne
brad.browne@informa.com +1 (646) 957 8968
In Europe, Jonathan Fletcher will help:
jonathan.fletcher@informa.com +44 (20) 337 73302

27. www.lloydslist.com/ll/topic/costa-concordia/