General Average Declared – Ever Given

Ever Given ran aground in the Suez Canal on March 23, 2021. With the assistance of 13 tugboats and dredgers, the vessel was successfully refloated on March 29th. Declaring General Average means it is likely shippers, who have cargo aboard the 20K mega container vessel, will bear the cost of the salvage operation which required 11 tugs and two dredgers to refloat the grounded vessel from a bank in the Suez Canal. Additional charges could be added by the Suez Canal Authority, claims from vessel salvors and others.

What is General Average?
“A maritime principle that requires that the shipowner and its customers share a proportionate amount of costs associated with saving a vessel after a major casualty. When General Average is declared, cargo owners are required to contribute to a GA fund before cargo can be released.” No estimate of cost to be shared by shippers prior to release of their cargo has been determined. It may take adjustors a considerable amount of time to make such a determination.

General average was also declared by Hapag Lloyd in January 2019, on the Yantian Express. The declared General Average was in excess of 60%. For an uninsured importer who had a $50,000 shipment on board, they would have had to make a cash deposit or bond in the amount of $30,000 in order for their freight to have been released. For an insured importer, they would not pay anything more than what was billed to them at time of insurance issuance. Rather the insurance company would post bond with the carrier, and when available, their shipment would be released.

Uninsured cargo?
Don’t risk shipping your goods without Marine Insurance. Contact your Western Overseas Client Representative for information regarding how to insure your cargo.