Japan to provide P&I, compensate cargo, hull cover for crude, oil products, LNG transport
Japan's Cabinet approved on Oct. 13 a bill under which the government will provide protection and indemnity cover and partially compensate cargo and hull insurance payments for the transport of crude oil, oil products and LNG, a METI official said. The bill is one of three approved to enhance the security of Japan's crude oil supply amid the conflict in the Middle East. The official said the scope of the specified tanker act will be expanded from crude oil to petroleum products such as naphtha and LNG, and that METI will introduce similar support for hull and cargo insurance, including a program to compensate non-life insurers for marine property insurance claims where reinsurance provision is prohibited.
Why it matters: The extension of sovereign-backed marine insurance to LNG and refined products makes energy security dependent on state risk-bearing when commercial reinsurance is unavailable.