Lloyd’s of London announced that “broker Jardine Lloyd Thompson (JLT) and a group of Lloyd’s syndicates, alongside other major insurance companies, have underwritten a bespoke policy to cover one of the largest and most challenging polar expeditions ever undertaken.”
The bulletin explained that the expedition, billed as the “Coldest Journey,” will be headed by Sir Ranulph Fiennes, who “will lead a team of five other explorers as they attempt to become the first people to traverse Antarctica in the winter, a feat never before attempted. The crossing has been considered too dangerous to try until now, and is described by the team as the last great polar challenge.”
Lloyd’s also pointed out that “up until now, The Foreign and Commonwealth Office has refused permission to take on the challenge because it has always been deemed far too risky and the chances of disaster too high. However, permission was granted for this expedition after it was shown that technological innovations could mitigate some of the major risks of the crossing.”
A significant mitigating factor was the expedition’s ability to obtain insurance coverage, which, Lloyd’s said, “played a critical role in obtaining permission. The UK Foreign and Commonwealth Office required evidence of adequate insurance cover to ensure that the pristine Antarctic environment would be protected.”
Without this coverage the expedition would simply not have been able to go ahead, noted Tony Medniuk, Chairman of the expedition’s Board of Trustees, and a leading figure in the London insurance market. The policy is 55 percent underwritten at Lloyd’s with the remainder supported by the London company market.
“This is the insurance market at its very best and insurance broking at its most creative,” Medniuk stated. “JLT have worked with us for many months to design the cover and bring the risk to the market, finding a leading Lloyd’s underwriter in Beazley and placing it in the co-insurance market.” As a charity, the expedition is now looking to have the premium sponsored, he added.
Justin Gillingham, a partner at JLT Specialty noted that the unprecedented nature of the expedition and the extreme conditions made the risk difficult to assess and place. “This was not an easy risk to place. We had to design a specific product and seek the support of insurers for an expedition that had never been attempted before,” he explained; adding that “the risk does not fit in the traditional contingency, marine, property or liability markets, and many insurers felt they did not have the expertise to assess the unusual risk.”
The policy covers search and rescue and the cost of remediating any potential damage to the sensitive Antarctic environment, such as removing abandoned or broken down equipment. It has been four years in preparation, and “requires a huge amount of specialist equipment able withstand the extreme polar conditions,” Medniuk noted. He also indicated that he has previously dealt with a similar challenge when he arranged the insurance program for Sir Ranulph’s 1979 – 1982 Transglobe Expedition.
Lloyd’s said the “expedition will make the traverse driving two specially adapted caterpillar tractors that will pull two converted cabooses – home to the team’s dormitory, workshop and science laboratory – as well as supplies and fuel. Team members will ski ahead of the vehicles with crevasse detection equipment. Some 100 tons of equipment left London on December 6, 2012, and is now en route to the Antarctic where it arrives in late January 2013.
“The 4,000 km [2500 mile] traverse gets underway in March and will see the explorers spend 273 days on the ice, mostly in complete darkness, and in temperatures possibly as low as minus 90 degrees Celsius [-130°F]. The expedition team will be entirely self-sufficient as there is potentially no search and rescue facility available in the winter due to darkness and hostile conditions. Until now, the challenge has been seen as a step too far.”
The bulletin explained that the expedition’s primary goal “is to raise a $10 million for ‘Seeing is Believing,’ an international initiative established by Standard Chartered Bank which is tackling avoidable blindness. The expedition also has a scientific and educational mission, as the team will carry out scientific data collection and broadcast its adventures to potentially 100,000 schools via a web portal.”
Dr. Dougal Goodman, Chief Executive of The Foundation for Science and Technology and Deputy Chairman of the expedition’s science committee, commented: “Crossing the Antarctic during winter is a wonderful and unique opportunity to collect key scientific data to further scientists’ understanding of Antarctic continent and human response to isolation and extreme conditions.”
Source: Lloyd’s of London
Topics Excess Surplus Market London Lloyd's
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