GUIDE TO CARGO CARRYING CONTAINERS OPEN TOP CONTAINER

Prepared by IMUAs Loss Control and Claims Committee

Copyright @2005 Inland Marine Underwriters Association

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IMUA STATEMENT
,he Inland Marine Underwriters Association 2IMUA3 is a not'4or'pro4it national trade association 4oc sed on the co11ercial inland 1arine line o4 5 siness0 IMUA was organi6ed in 17&0 as a national trade association and rating 5 rea 4or all inland 1arine classes0 In 174! the rating 5 rea acti8ities o4 the IMUA were trans4erred to the Inland Marine Ins rance 9 rea $now de4 nct% d e to the 1744 US S pre1e Co rt decision in the So th':astern Underwriters Association case0 ,oday, IMUA is co1prised o4 '' Members ' ins rance and reins rance co1panies that nderwrite a signi4icant portion o4 the co11ercial inland 1arine ins rance in the U0S0 Associate Members ; co1panies or organi6ations that pro8ide prod cts and/or ser8ices to the ins rance ind stry0 IMUA is co11itted to ad8ancing the ed cational, go8ern1ental, reg latory and technical interests o4 the co11ercial inland 1arine ins rance ind stry0 <ne o4 the ser8ices IMUA pro8ides its 1e15ers is the p 5lishing o4 in4or1ation 4or se 5y nderwriters, loss control and clai1s specialists, and other interested parties0 ,he topics co8ered 5y IMUA =eports, 9 lletins and "ews Articles are intended to pro8ide an o8erall awareness o4 the iss es, ha6ards and e)pos res associated with a speci4ic ind stry or inland 1arine class o4 5 siness0 >ol nteer 1e15ers o4 a technical co11ittee o4 the IMUA or IMUA sta44 ha8e prod ced this in4or1ation0 Co11ittee 1e15ers a5ide 5y antitr st restrictions while co1piling in4or1ation0 It is generally not possi5le to treat any one s 5?ect in an e)ha sti8e 1anner, nor is it IMUA@s intent to do so0 "o warranties are 1ade regarding the thoro ghness or acc racy o4 the report or any part o4 it0 "othing in this report sho ld 5e interpreted as pro8iding de4initi8e g idance on any A estion relating to policy interpretation, nderwriting practice, or any other iss es in ins rance co8erage0 IMUA does not prescri5e to its 1e15ers how to 1aBe nderwriting or clai1s decisions, nor does it reA ire that analysis 4ollow any partic lar 4or1at0

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IMUA offers thanks and appreciation to the Committee members for their contribution to this Report:

Loss Control and Claims Committee

Barry Tarnef (Committee Chair) Chubb Marine Underwriters Dave Matana (Co-Chair) ISO eor!e a"ey #ireman$s #und S%e&ia'ty Underwriters +arry Cra8es ; Sp 1i4er A1erican Satish Dain ; Ceneral Star Sta&ey (aufman )o*a&+ Cor%oration (eith (em%f ,r&h Insuran&e Com%any Brian Marbur!er St- .au' Com%anies Donna .o%ow ,meri&an Institute for C.CU /im Titterton Chubb rou%

TABLE OF CONTENTS

Description Characteristics Values Exposures Loss Prevention Considerations For Further n!ormation

4 4 5 5 6 "

GUIDE TO CARGO CARRYING CONVENYANCES

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OPEN TOP CONTAINER

Description: ,he open top container is s ally constr cted with doors at one end $and possi5ly at the center%, with a top that is co1pletely open, 5 t that can 5e enclosed 5y protecti8e tarpa lins so1eti1es s pported 5y re1o8a5le roo4 5ows that can add a 1eas re o4 str ct ral sta5ility0 ,his type container is generally sed 4or the carriage o4 hea8y, 5 lBy or awBward ite1s, especially those that are taller than the standard, 4 lly enclosed, general p rpose dry cargo container0 ,he open top is ideal 4or loading or discharging cargo when access thro gh either the end or side door$s% is si1ply not practical0 Considering the cargo@s e)pos re to the ele1ents, the cargo space is o4ten protected 4ro1 the ele1ents 5y either a solid, re1o8a5le $Ehard topF% co8er, or 4a5ric $so4t or EragF top% co8er0 Stea1ship lines and container leasing co1panies o4ten pro8ide the disposa5le 4a5ric tarpa lins0 So1e 20'4oot open top containers ha8e integral 4orBli4t pocBets to ena5le se o4 1echanical cargo handling de8ices0 ,he open top container nor1ally co1es in standard 20' and 40'4oot lengths0 In 4act there are al1ost an identical n 15er o4 5oth types in the world 4leet0 In addition, there is an e)tre1ely s1all in8entory o4 tr ly p rpose'5 ilt nits that ha8e di44erent di1ensions0 ,he e)ternal width o4 the standard open top container is ! 4eet and the height is !05 4eet0 "ote that the act al roo4 opening is slightly s1aller than the internal di1ensions d e to the protr sion o4 the top side rails reA ired to s pport the roo4 5ows and the st 5s that s pport the header 5ar o8er the rear door0 ,his type container is s ally 4a5ricated o4 corr gated steel with a hardwood ti15er planB or plywood 4loor0 Characteristics: ,here are two niA e design/constr ction 4eat res o4 the open top container0 ,he 4irst is a door header that can 5e sw ng o t th s 4acilitating loading 4ro1 the rear doors i4 needed or possi5le depending on the si6e o4 the ite10 ,he second design 4eat re in8ol8es roo4 5ows that s pport a
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can8as or tarpa lin Eso4t topF that are re1o8ed d ring loading 4ro1 a5o8e, then replaced $i4 the height o4 the cargo will allow% and 4astened to 5 ilt'in lashing 5ars0 ,he roo4 5ows also contri5 te to the sta5ility o4 the container0 ,he load'5earing capacity o4 the 4loor e)ceeds the IS< $International Standards <rgani6ation% standard 5y thirty' three percent $&&G%, and th s can acco11odate the weight o4 a 4orBli4t tr cB0 +owe8er, the open top container is not an ideal 1atch 4or e)tre1ely hea8y pieces o4 cargo $hea8y li4ts% d e to the press re these ite1s can e)ert on the container 4looring0 " 1ero s lashing points are located along the longit dinal rails as well as on the 4loor and corner posts0 ,hese de8ices each ha8e a per1issi5le load o4 2,205 l5s0 $1,000'Bg0% each0 Values: ,he cost o4 a new open top container 8aries 5ased on a n 15er o4 4actors, principally the c rrent price o4 steel, la5or costs and the 1acro'econo1ics o4 the shipping and container ind stries0 =ecently we ha8e seen a higher le8el o4 o tp t 4ro1 the 1a?or container 1an 4act rers that ha8e depressed pricing e8en with the anticipated increase in glo5al de1and 4or containers in general0 According to statistics co1piled 5y the Instit te o4 Container Hessors in their latest Ann al S r8ey, the a8erage cost o4 an open top container is e)pected to 5e I2,700 in 2005, 8irt ally the sa1e as the a8erage 8al e o4 a new 5 ilding o8er the past three years0 ,he costs o4 containers is 4l id with 1aterial $steel and to a lesser e)tent plywood% prices, 1an 4act ring capacity and worldwide de1and Bey deter1inations0 ,here is an acti8e leasing 1arBet and th s older containers are readily a8aila5le 4or re'sale0 ,hese containers ha8e di44ering li4e spans 5 t generally are recycled e8ery *'10 years0 ,he open top container tends to 5e sed less than the general p rpose dry cargo typeJ howe8er, the nat re o4 the cargo they transport and the 1ethod o4 loading and nloading can accelerate their physical and 4inancial depreciation0 Exposures: Cargo carried in an open top container is 1ore prone to contact with ad?acent cargo, either d ring handling, stowing a5oard the 8essel, stacBing on land or d ring transit0 K e to the potential a5sence o4 any protection 4ro1 the ele1ents, the cargo is also e)posed to the weather0

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Since these containers do not a44ord 4 ll str ct ral protection to the cargo, the contents are 1ore s scepti5le to da1age 4ro1 e)ternal contact0 I1proper sec ring o4 the cargo can 5eco1e 1agni4ied0 I4 the lashings 4ail, the cargo can co1pletely 5reaB loose, wreaBing ha8oc on itsel4, the carrying con8eyance and other cargo0 More 1aintenance is s ally reA ired 4or the open top container0 ,his 1ay 5e 1ore a 4 nction o4 the type o4 cargo they carry than the str ct ral 4itness o4 the container0 ,he 4a5ric co8ers are s 5?ect to weathering and da1age d e to wear and tear0 Ideally, these tarpa lins sho ld 5e inspected each ti1e they are sed, checBed 4or de4ects, and replaced i4 too 1 ch wear and tear is 4o nd0 When the hard tops are sed, special handling eA ip1ent is needed 4or 5oth their place1ent and re1o8al0 Loss Prevention Considerations: ,he International Con8ention 4or Sa4e Containers 2ICSC3, an International Mariti1e <rgani6ation 2IM<3 doc 1ent was 4inali6ed in 17**0 ,he doc 1ent 1aBes certain str ct ral reA ire1ents 1andatory 4or containers 1o8ing in international trade0 Appro8ed nits are iss ed sa4ety plates that are a44i)ed to the container at the ti1e o4 1an 4act re0 :)a1ination o4 these pre'certi4ied containers is then reA ired at se8eral inter8als0 ,he initial inspection occ rs when the container is deli8ered to the initial 5 yer0 ,hen, periodic inspections are reA ired at 5'year inter8als0 ,he appearance o4 the ICSC seal is 5y no 1eans a g arantee o4 the container@s s ita5ility 4or se, especially as the container ages0 ,he 1ost i1portant thing that a shipper can do when recei8ing a container 4or se is to cond ct a thoro gh pre'ship1ent inspection0 ,he shipper or its representati8e sho ld taBe the ti1e to care4 lly checB 4or any da1age/de4ects that 1ight ?eopardi6e the sa4e arri8al o4 the cargo at destination0 Cargo s scepti5le to da1age 4ro1 r st, o)idation or corrosion or in any way ad8ersely a44ected 5y contact with water or other potential conta1inants sho ld ha8e its own protection in addition to the presence o4 the 4a5ric co8er o4 the container0 ,he co8er can 5e torn/ripped or otherwise rendered ine44ecti8e, 1ost nota5ly d ring handling and stowage and 1ay allow water ingression0 ,he cargo 1 st 5e positioned in/on the open top container so that the weight is properly distri5 ted0 (ro1 a practical standpoint all transport arrange1ents, especially the road or rail transit leg, 1 st 5e worBed o t well in ad8ance0 Hocal weight and/or di1ension li1itations 1 st 5e 4actored into the planning process0 In addition, consideration 1 st 5e gi8en to the cargo

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handling capa5ility at destination0 ,he 4acility recei8ing the cargo in the open top container needs the appropriate handling eA ip1ent0 ,he container 1 st 5e care4 lly inspected prior to se to ens re that it is s ita5le $4ree 4ro1 str ct ral de4ects% 4or the acceptance and carriage o4 the intended cargo0 <4 critical i1portance in an open top container are the lashing points0 "ot only 1 st there 5e an adeA ate n 15er 5 t they 1 st 5e in good operating conditions to ens re the load is sec re d ring handling and transportation0 For Further Information# EContainer Speci4icationF ; a 5ooBlet 5y +apag'Hloyd EContainer -acBingF ; a 5ooBlet 5y +apag'Hloyd Hloyd@s S r8ey +and5ooB 5y Hloyd@s o4 Hondon -ress Htd0 EShippers@ C ide 4or -roper Stowage o4 Inter1odal Containers 4or <cean ,ransportF ; a 5ooBlet 5y "ational Cargo 9 rea Inc0 ESa4e Stowage, A C ide 4or :)portersF 5y ,he Canadian ,rade Co11issioner Ser8ice International Instit te o4 Container Hessors, 9ed4ord, "# at www0iicl0org IICH 1e15er co1panies represent appro)i1ately 7*G o4 the container leasing ind stry and a5o t one'hal4 o4 the world@s container 4leet0

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