Sometimes your vessel’s protection and indemnity (P&I) insurance is much broader than you think.
P&I insurance has been around for centuries. It was originally written to protect ship owners and masters while the ships took months, or even years, to complete their voyages. P&I policies covered crewmembers for a wide range of injuries, illnesses and accidents.
The age and extent of the precedents set for vessel P&I insurance is responsible for keeping the coverage so broad. By contrast, land-based liability insurance is much more modern and, as a result, its coverage is much more limited. Why? Because it involves covering premises, autos, trains, planes, trucks and because it includes things like malpractice, hiring practices and sexual misconduct.
Here are two interesting cases:
The first involved a small coastal domestic cruise ship operating in the U.S. It was staffed with a full crew including kitchen staff, an event director and shore excursion director, and the operational crew. While in port one evening, one of the kitchen staff (who probably had too much to drink) allegedly made advances on the event director. A scuffle turned into an alleged assault. The claim was honored by the ship’s P&I insurance company. Such coverage would be available for most assaults and even bar fights. For a land-based employer, insurance would have to include a special endorsement called Employment Practices Liability coverage (EPLI).
In another example, a group of teenaged Sea Scouts was aboard a schooner for a sail training/character building trip. The schooner’s crew was experienced and all were 21 and older. It was later alleged that a 22-year-old second mate (female) had sexual relations with a 15-year-old scout during the trip. The second mate was charged with criminal statutory rape, which was not covered by the vessel’s P&I. However, the scout’s family alleged to both the Boy Scouts of America and the schooner owner that their son had been psychologically injured and they made monetary demands. After some wrangling, the claim was deemed covered by the P&I policy and the schooner owner was ultimately defended by the ship’s insurance company.