Regulation - II (Compliance)
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Let me explain my background. I have worked as under two years as a Ship surveyor. (Read Lloyd's and Classification Society too).
In shipping sector almost all the inspection, survey and the certification is done by Classification societies. There are private players (specifically, The big three) as well as government appointed ( IRS).
In general shipping is a field not known for honesty. By the very nature it has been through out history a magnet for unscrupulous element who are ready to bend (or break) few rules here and there to make an extra profit.
Enforcing the rules faces resistance from ship owners, ship builders and good old bureaucracy. And yet the classification societies have done a fine job of enforcing the safety standards.
The reason for this is insurance company. As there are huge costs(owner's damage and/or penalty) for any accident, the insurance company/underwriters can not accept certificate from a society which doesn't have impeccable standards of honesty and integrity (All of big three are around 150 years old, Lloyd's is more than 200 )
Also, despite bureaucracy, port authorities are wary of any accidents in ports, so even if there is government appointed agency, port authorities will prefer certificates issued by established and well reputed societies.
This system can be effectively used to enforce fire and safety regulations.Any approval by authority should be dependent on insurance coverage.The insurance company will only issue certificate based on assessment by an independent assessor. Because insurance companies have to pay in case of any mishap, they will rely only on the honest assessor and hence this will ensure a better compliance.
Let me explain my background. I have worked as under two years as a Ship surveyor. (Read Lloyd's and Classification Society too).
In shipping sector almost all the inspection, survey and the certification is done by Classification societies. There are private players (specifically, The big three) as well as government appointed ( IRS).
In general shipping is a field not known for honesty. By the very nature it has been through out history a magnet for unscrupulous element who are ready to bend (or break) few rules here and there to make an extra profit.
Enforcing the rules faces resistance from ship owners, ship builders and good old bureaucracy. And yet the classification societies have done a fine job of enforcing the safety standards.
The reason for this is insurance company. As there are huge costs(owner's damage and/or penalty) for any accident, the insurance company/underwriters can not accept certificate from a society which doesn't have impeccable standards of honesty and integrity (All of big three are around 150 years old, Lloyd's is more than 200 )
Also, despite bureaucracy, port authorities are wary of any accidents in ports, so even if there is government appointed agency, port authorities will prefer certificates issued by established and well reputed societies.
This system can be effectively used to enforce fire and safety regulations.Any approval by authority should be dependent on insurance coverage.The insurance company will only issue certificate based on assessment by an independent assessor. Because insurance companies have to pay in case of any mishap, they will rely only on the honest assessor and hence this will ensure a better compliance.
4 comments:
Dear Gaurav:
Your job profile certainly looks very interesting. I will try to go through the Lloyd's link later to know more about classification societies.
Best wishes for your new job.
cheers,
CN,
It does look very interesting, I wish it was more :-)
Welcome & Thanks & Regards
What a great site » »
Very cool design! Useful information. Go on! »
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