4 July 2001

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Insurance crisis for water sports sector
By Miriam Dunn

Time is running out for water sports’ operators to find a company willing to provide them with insurance.

Paul Ebejer, chairman of the water sports’ association, admitted that if he and his colleagues don’t manage to find cover for their businesses by August, they will be faced with the dilemma of whether to close down or continue operating without insurance.

He explained that the saga began last November when the operators were informed that their insurer to date – Lloyds, represented in Malta by Ark, - were pulling out.

"When we made further enquiries, it emerged that the company seemed to have made a decision to stop insuring water sports’ operators through certain regions of the Mediterranean, because the claims’ record is apparently high," Mr Ebejer said. "We discovered that they had also pulled out of other tourist destinations, such as Greece and Cyprus. We can’t even get a deal on third party cover, let alone full."

He explained that after they were informed of the decision, the water sports’ operators embarked upon the task of trying to find replacement insurance, but so far, no company has offered them cover.

With the August D-Day now fast approaching, the situation has become critical and efforts are being made to persuade local insurance companies to take at least some of the businesses, with mediation attempts spearheaded by Tourism Minister, Michael Refalo.

Mr Ebejer said there is hope that some kind of a deal could be struck.

"The association has managed to find two international companies willing to take 70% of the risk," he explained. "Now we are trying to find a local firm to shoulder the other 30%. Hopefully someone will show willing."

The chairman of the water sports’ association stressed that the situation has now become critical, since, by next month, the operators’ insurance will run out.

"For many of us closing down is simply not an option," he said. "Apart from the fact that it is obviously very bad for business all over the island, many of us have commitments with the banks, or otherwise. We will be put in a position where we have to open with no insurance."

Water sports have been the subject of a number of bad press reports over the past few years, although, to be fair to the association, many of the accidents or complaints that find their way into the newspapers relate to seacraft that are privately owned rather than those belonging to ‘bona fide’ operators.

However, the problem of not managing to find insurance will be something that the water sports’ operators – eager to distance themselves from adverse publicity and aware that they are working in a sector regarded as having an element of danger – would want to see solved as soon as possible.

The Business Times, Network House, Vjal ir-Rihan San Gwann SGN 07
Tel: (356) 382741-3, 382745-6 | Fax: (356) 385075 | e-mail: editorial@networkpublications.com.mt