Smooth Sailing or a Risky Expedition: A Critical Exploration into the Innovation of Unmanned Maritime Vehicles and Its Potential Legal and Regulatory Impacts on the Insurance Sector

Abstract

Over the years, technology has continuously evolved to create new and innovative products that have a tremendous impact on global business, trade and commerce. In the transportation industry, technology has been developing and evolving to introduce various automatic vehicles. In the motor vehicle industry, many car manufacturers have been investing significantly in developing unmanned ground vehicles such as driverless cars and similarly in the airplane industry, unmanned aerial vehicles also known as drones have been flooding the consumer and commercial markets. It is thus unsurprising that in the maritime sector, several shipping manufacturers are currently exploring, developing and designing unmanned maritime vehicles also known as unmanned maritime vessels or autonomous vessels. These vessels sometimes colloquially referred to as “ghost ships” are expected to replace the need for a master and crew, which are traditionally found on conventional manned vessels. These vessels are expected to revolutionise the shipping industry in the very near future. As unmanned vessels are a relatively new phenomenon, there is not a large amount of academic discourse generally on the topic and as such very little has been written on its potential impacts specifically on the insurance sector globally.

This chapter embarks on a critical expedition into the innovation of unmanned maritime vehicles and its potential impacts on the insurance sector. To effectively do so, this chapter critically examines the benefits that can be derived from the use of unmanned vessels juxtaposed against the drawbacks to the insurance sector. This chapter also critically assesses the new risks posed to the maritime sector and the wider society from the use of unmanned vessels and proposes ways in which the insurance sector can develop products and policies or amend existing products and policies to lessen these risks. This chapter further critically discusses how the insurance sector should address the issue of liability as it relates to maritime incidents and accidents that are likely to arise from the use of unmanned maritime vehicles.

This chapter also embarks on a voyage that explores whether selected international maritime conventions are in their present state able to regulate unmanned maritime vehicles so as to afford protection to the relevant stakeholders. In this respect, the author also assesses whether these international conventions are in need of reforming or whether new international conventions need to be implemented so as to offer regulatory support to the insurance sector against the risks posed by unmanned vessels. In this respect, this chapter also examines how regulation at the national level can be used to assist the insurance sector manage the risks posed by unmanned shipping.

Additionally, this chapter further examines how traditional commercial maritime contracts such as the charter party and bill of ladings should be drafted to cover insurance related risks from unmanned maritime vehicles. Corollary to this, the author carefully considers whether in this respect, standard form charter parties are currently drafted in a manner so that they can be used for international trade occurring on unmanned vessels. The author also considers whether the relevant clauses of selected standard form charter parties are adequately drafted to address all the various risks unmanned vessels give rise to, and considers whether there needs to be new standard charter parties developed exclusively for trading by unmanned vessels.