Why are fishermen reluctant to insure their fishing boats?

In their voyages at sea, fishermen not only face rough seas but also accept countless risks related to their vessels, lives, and catch. Fishing vessel insurance helps them feel secure while working at sea, contributing to the protection of resources for the local fisheries industry. However, in reality, this policy has not yet fully achieved its effectiveness, as participation rates remain low, fishermen are still hesitant, and insurance companies are cautious.

Tired of waiting for insurance money.

In 2021, the fishing vessel NA 93704 TS, with a 400CV engine, owned by Mr. Le Duc Tuong from Tan Hai hamlet, Quynh Lap commune (formerly), unexpectedly caught fire and sank while fishing in the Gulf of Tonkin. His vessel was insured for 21 million VND per year, so immediately after the incident, his family contacted and submitted documents to relevant authorities hoping to receive compensation. However, even after four years, the insurance money has still not been paid.

Mr. Le Duc Tuong said that after the incident, the insurance company claimed that the claim was insufficient to warrant compensation, leading to a prolonged processing time. To maintain their business, the family was forced to borrow nearly 1 billion VND to buy a used 300CV fishing vessel to continue fishing. “The difficulties are piling up, and not yet receiving the insurance money is putting a lot of pressure on the family. Currently, we don't dare buy fishing vessel insurance anymore because we worry about the complicated procedures and high risks,” Mr. Tuong shared.

The reality in Quynh Lap commune (formerly Hoang Mai town), now Tan Mai ward – the locality with the largest number of fishing boats in the province – clearly demonstrates this. Mr. Nguyen Que Quyen, a fishing boat owner, said: “Three years ago, I bought insurance for my boat. When the boat caught fire, the compensation procedure was very complicated, taking several years to get paid. The cost of processing the paperwork was considerable, so many fishermen in the village became discouraged and no longer interested in participating.”

The former Quynh Lap commune currently has 110 fishing vessels over 20 meters in length and nearly 60 vessels under 20 meters. According to Mr. Phan Van Hai, Chairman of the Quynh Lap Fisheries Association, among the 110 vessels over 20 meters, 23 were built under Decree 67/CP, requiring mandatory insurance due to bank loans. The remaining vessels have very little insurance, due to delays in insurance payouts after accidents and complicated procedures.

The costs and paperwork are complicated.

According to statistics from the Department of Agriculture and Environment, the province currently has more than 3,400 fishing vessels, of which about 1,200 are large vessels that regularly operate in distant waters. However, the number of vessels actually participating in hull insurance is still limited to the mandatory level for vessels built under Decree 67/CP.

Going out to sea to make a living. Photo: Xuan Hoang

The main reasons stem from the high costs and complicated paperwork. Insurance premiums for a fishing vessel with a capacity of 90 horsepower or more range from tens to hundreds of millions of VND per year, depending on the value of the vessel and the number of crew members. Meanwhile, fishermen's income depends entirely on catch yields, weather conditions, and fluctuations in the market. Many boat owners believe that having to spend a large sum of money without any guarantee of compensation leads them to accept the risks.

A fishing boat fire at Lach Quen Fishing Port in 2022. Photo: Xuan Hoang

Fisherman Truong Quang Hoa, owner of a fishing boat in the former Quynh Lap commune, believes that to encourage fishermen to buy fishing boat insurance, insurance companies need to support them in case of accidents. This includes guiding fishermen through the necessary paperwork and procedures, as fishermen's knowledge is often limited.

Fishermen go through procedures to trace the origin of seafood after docking at the fishing port. Photo: Xuan Hoang.

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To encourage fishermen to buy fishing boat insurance, insurance companies need to support them when accidents occur. This includes guiding them through the necessary paperwork and procedures, as fishermen's knowledge is often limited.

Fisherman Truong Quang Hoa - owner of a fishing boat in Tan Mai ward.

According to regulations, fishermen who participate in fishing vessel insurance will be compensated in cases of risks such as natural disasters, collisions, fires, explosions, and serious damage; crew members are insured against life-threatening work-related accidents.

However, the reality is different. Many accidents occur, but the compensation is low compared to the damage, or the process is prolonged due to complex procedures. Some provisions are also not truly "close" to the specifics of the fishing industry. In addition, the process of assessing and verifying the scene in distant waters faces many difficulties, leading to delays in compensation settlement.

Not only are fishermen hesitant, but even insurance companies are reluctant to implement these policies. Fishing inherently involves many risks, while preventative measures are limited. Insurance companies frequently face the risk of losses due to high accident rates.
An official from Saigon - Hanoi Insurance Company (BSH) stated: "In many cases, verifying the cause and extent of damage is not easy, putting immense pressure on businesses. Therefore, for more than two years, the company has stopped providing insurance for fishing vessels, only maintaining insurance for crew members."

When the "shield" of insurance is strengthened, fishermen will have more confidence to continue fishing at sea. Photo: Xuan Hoang

Similarly, the Pjico Insurance Company's Nghe An branch has also been reluctant to sell fishing vessel insurance for many years. A representative from the Pjico Insurance Company's Nghe An branch stated that selling fishing vessel insurance currently faces many difficulties, not only for fishermen but also for the insurance company. These include the high number of accidents involving vessels each year, and the difficulty in assessing damages because accidents at sea are hard to determine the cause. This is also the reason why fishermen find it difficult to complete the necessary paperwork and procedures for claiming compensation.

A solution is needed to resolve the issue.

In previous years, the government had a policy of subsidizing insurance premiums under Decree 67, helping fishermen reduce their financial burden. However, this mechanism has now ended, forcing boat owners to pay the full amount themselves. This has further led to a sharp decline in insurance participation rates.

Large fishing vessels are valuable assets for fishermen, providing employment for dozens of workers; therefore, participating in insurance is very important for them. Photo: Xuan Hoang

Mr. Vu Ngoc Chatt, Chairman of the Quynh Long Fisheries Association (now Quynh Phu commune), stated: “If fishing vessels are insured, the risks for fishermen will be shared, allowing them to confidently stay at sea and contribute to protecting maritime sovereignty and islands. The State needs to have a mechanism to support insurance premiums, especially for offshore fishing vessels. At the same time, insurance companies also need to improve their procedures to ensure faster and more transparent compensation.”

In reality, besides the cost, fishermen's understanding of insurance remains limited.

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For a long time, the State has been implementing a policy to support fishermen according to Decision 48 of the Prime Minister, which includes provisions such as insurance support for crew members and fuel costs when venturing far offshore. However, fishermen's knowledge of insurance is incomplete, while the procedures and payment processes are still complicated, creating a sense of apprehension. This is the reason why many boat owners are no longer enthusiastic about participating in fishing vessel insurance.

Mr. Tran Xuan Hoc - Deputy Director of the Department of Agriculture and Environment

Practical realities necessitate appropriate adjustments to ensure that fishing vessel insurance truly becomes a solid "shield." First and foremost, authorities need to consider restoring or implementing policies to subsidize insurance premiums for offshore fishing vessels, a force directly involved in protecting maritime and island sovereignty.

In addition, insurance companies must also change their approach. The claims assessment and compensation process needs to be quick, transparent, and avoid eroding fishermen's trust. Insurance packages should be designed to better suit the specific characteristics of the fishing industry, covering even small but frequent risks.

On the other hand, public awareness campaigns also need to be intensified. Fishermen must be equipped with knowledge about their rights and obligations when participating in insurance, so that they understand that this is not a burden, but a way to protect themselves, their families, and their boats, their most valuable assets.

Fishermen stay at sea, contributing to affirming sovereignty over the sacred waters of the Fatherland. Photo: Xuan Hoang

Nghe An province has a long coastline and abundant marine resources, making it one of the key provinces for seafood exploitation. However, to transform this potential into an advantage, ensuring the safety and protection of fishermen is paramount. When this "safety shield" is strengthened, fishermen will have more confidence in staying at sea, contributing to affirming sovereignty over the sacred waters of the Fatherland.

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Source: https://baonghean.vn/vi-sao-ngu-dan-khong-man-ma-bao-hiem-tau-ca-10310226.html