Lawyers for Ecuador’s Galapagos Islands plan to sue for damages in the wake of an oil spill, according to several news reports; however, the Miamai, Florida-based insurance agency that placed the coverage maintains the policy had been cancelled prior to the accident that caused the spill.
“Furthermore we have had no contact from Ecuadorian officials,” said Hadrian Tuck, a partner at Air & Sea Insurance Corp, “All we know is what we’ve read in the press.”
The 835-tonne Jessica ran aground in the Galapagos in January, leaking some 240,000 gallons of oil it was carrying into the unspoiled waters surrounding the islands made famous by naturalist Charles Darwin. The archipelago, home to some of the planet’s rarest creatures, is located about 600 miles west of Ecuador in the Pacific Ocean.
The Galapagos government said it would sue the insurer in U.S. federal court under an international agreement on civil liability for oil pollution for refusal to salvage and failure to pay the $10 million policy limit if the company does not agree to pay within 30 days, said Steven Marks, representing the Galapagos government. Tuck said the policy was not in force at the time of the spill due to non-payment of the premium. “The owner had not made any premium payment since the third quarter of 2000, ” said Tuck. “There was no coverage.”He also said the notice of cancellation is fully documented by both Air & Sea and Terra Nova, the London market that had underwritten the risk.
Tuck said that Steven Mark’s claim that under Ecuadorian law, coverage remains in place regardless of the payment of premiums, is nonsense. “There would be no point in paying a premium, were that the case,” he said.
“The insurance company delayed and then ultimately refused to provide salvage,” Marks told a news conference. “The ship is still sitting there. For many months it oozed fuel and contaminated the islands.” Marks said the cost of containing and cleaning up the spilled oil was approaching $10 million. The ultimate damage to the Galapagos’ ecosystems would be much higher, he noted. Ecologists have said the Galapagos will probably make a full recovery from the tanker disaster. But government officials say the full extent of the damage will not be known for at least two more years.
Officials said the islands host 70,000 visitors a year, making the Galapagos a $100-million-a-year industry that could be threatened by the oil spill and its attendant bad publicity. “We could lose at least half of that $100 million,” Alfredo Ortiz, mayor of Santa Cruz island, told the news conference, according to Reuters.
The Jessica still sits on a reef half a mile from Puerto Baquerizo Moreno on the island of San Cristobal.
Was this article valuable?
Here are more articles you may enjoy.
Dollar Tree Sold Lead-Tainted Applesauce After Recall 
Zurich to Buy AIG’s Travel Insurance Business for $600 Million 
As Rates Rise, Majority of Homeowners Say Insurance Industry Is in Crisis: Survey 
Allstate, Nationwide Post Dramatic Q12024 Homeowners Loss Ratio Drops: S&P From This Issue
