BSC gets $14.37m for Banglar Samriddhi damaged in Ukraine war

The state-run Bangladesh Shipping Corporation (BSC) has received $14.37 million as insurance payout for the damage incurred by the MV Banglar Samriddhi during the Russia-Ukraine war when a Bangladeshi crew member was killed.

On 21 March, state-owned Sadharan Bima Corporation paid the amount to BSC as compensation, which is equivalent to the market value of the vessel. 

The shipping corporation confirmed the receipt of the money in a release signed by BSC Deputy Secretary and General Manager (Administration) Mohammad Ashraful Amin on Friday.

BSC placed a Constructive Total Loss (CTL) claim to the insurance company after the vessel came under a missile attack while being docked at Olvia port in Ukraine on 2 March last year.

As per the Blocking & Trapping clause of the insurance contract, measures were taken on 24 February to expedite the recovery of the insurer and reinsurer claims amounting to $22.48 million. 

BSC was paid $14.37 million in compensation after deducting insurance premiums from the amount claimed.

Earlier on 22 February 2022, the ship sailed to Olvia port in Ukraine. While stationed in the harbour's inner anchorage, the Ukraine-Russia War began on 24 February. 

The ship could not leave the port due to closure of the port, mines laid at the entrance and lack of permission from the port authorities.

On 2 March of that year, the Bangladeshi ship was hit by a missile attack at 5:10pm local time in Ukraine. 

The third engineer of the ship, Hadisur Rahman, was killed in the attack. 

All navigation tools including the bridge room were completely damaged in the attack.

With the help of the Ministry of Shipping, the Ministry of Foreign Affairs, and Bangladeshi Embassies located in Poland and Romania, BSC was able to bring back the sailors of the ship on 9 March of that year and the body of Hadisur Rahman on 14 March.

On 16 June of that year, the Ministry of Shipping paid a total compensation of Tk7 crore to the affected sailors and their families.

Following Russia's invasion of Ukraine a year ago, the Black Sea was listed as a high risk zone by the London insurance market, and additional war risk insurance premiums of tens of thousands of dollars a day are common costs alongside fuel and freight.

Ship owners can claim a total loss for vessels stuck for a year from their insurers who face at least half a billion dollars in claims, according to industry sources. Insurers are grappling with over 60 ships stranded in Ukraine.

"The notice of claims will start coming in and this is where the process starts. It is possible that a settlement could be reached at a reduced rate enabling the owner to keep their ship and then sell it on," one insurance source involved said. "This will play out in the next few weeks."