Carnival Corp says it is going to take a $90million hit

[5waldos]

[quote name='Cruise-Crazy']From what I understand on this cruise they pick up new passengers at each port so they would have to do a drill at every stop. It would be interesting to know just how they normally handel this.[/QUOTE]

The muster must take place within the first 24 hours. I believe I read that it was scheduled for the next morning.

[BSUGrad]

[quote name='haikou']I took my first and last cruise with my daughter to Alaska this summer due tobudget constarints and after that experience and Carnival's nickel and diming/cost cuttng/cheap practices it is no tonder they got rid of more experiencd/senior crew in favor of less expensive, less experienced crew on the Concordia,which did not help dealing with the accident.For so many of the crew not to speak Italian when it looks like th emajority of passengers were Italian, is not good.The passengers had trouble communicating with the crew and in an emergency communication is critical! Carnival is cheap and cuts cost wherever they can and it showed on my cruise.I will stick with smaller, luxury lines, for whom safety is more imprtant than profit![/QUOTE]

Wow, really?? Good luck finding a cruise line that does not care about profit.

[5waldos]

[quote name='elcuchio24']Just guessing, but that sounds like an inflated BS media #. Still, it'll be bookings going forward that put the screws to CCL. Don't underestimate the general public's irrational fears.[/QUOTE]

Well- to begin with, if all the 4,000 passengers and crew were to sue, that would be about 320 million right there. Far exceeding the $90 million suggested yesterday (max of about $80,000 per person by maritime law). Unlawful deaths of 40 people (which sounds like it will be about what the figure will be)- don't know. Cost of getting the ship up plus the refurbishing it? Cost of rescue efforts? Environmental costs if the ship begins to leak? Doesn't sound too inflated to me. The $90 million sounds pretty low.

[big_duck]

[quote name='5waldos']Well- to begin with, if all the 4,000 passengers and crew were to sue, that would be about 320 million right there. Far exceeding the $90 million suggested yesterday (max of about $80,000 per person by maritime law). Unlawful deaths of 40 people (which sounds like it will be about what the figure will be)- don't know. Cost of getting the ship up plus the refurbishing it? Cost of rescue efforts? Environmental costs if the ship begins to leak? Doesn't sound too inflated to me. The $90 million sounds pretty low.[/quote]

The 90 million is just lost earnings.

It does not include insurance deductibles for liability insurance or insurance on the ship.

[elcuchio24]

[quote name='5waldos']Well- to begin with, if all the 4,000 passengers and crew were to sue, that would be about 320 million right there. Far exceeding the $90 million suggested yesterday (max of about $80,000 per person by maritime law). Unlawful deaths of 40 people (which sounds like it will be about what the figure will be)- don't know. Cost of getting the ship up plus the refurbishing it? Cost of rescue efforts? Environmental costs if the ship begins to leak? Doesn't sound too inflated to me. The $90 million sounds pretty low.[/quote]

Yes, but they do have insurances that cover much of those passenger lawsuits. What they don't have is insurance to cover loss of use and profit loss, that's what'll really get them.

[5waldos]

The 90 million is just lost earnings.

 

It does not include insurance deductibles for liability insurance or insurance on the ship.

 

That makes some sense.

[elcuchio24]

That makes some sense.

 

Hey, we're all just talking conjecture anyway, none of us will really know what the total disaster cost is until they start writing it off the books next quarter. As far as the impact to future earnings, that'll take even longer to shake out........

[tulsacubfan]

From what I understand they only have ship coverage for the actual ship. They don't carry revenue loss insurance.

 

Correct. They have coverage for the property damage but not the business interuption. They also have a liability policy for 3rd party losses.

 

However, they have a $30MM deductible on the property damage and $10MM on the liability policy (this info came from a Carnival release in an insurance magazine e-mail I get daily). Right there is a $40MM hit. That may or may not be part of the $90MM hit they are quoting.

[tulsacubfan]

:rolleyes:

 

Carnival is a publicly traded company and such is required by law to crunch these numbers and crunch them as quickly as possible.

 

And their insurance carriers are going to want this info quickly as well.

[CdrescherRBL152]

Acutually cost if all 4200 sue will be closer to $50,000,000, Costa has already said that all on board will be reciving refunds in full. And although 75k is the max. The apx. 36 dead, (based on 11 dead and 25 missing as ogf the last report I gheard), the remaining on board will have claims on injuries and lost personal items. Which ussaly average out to between 10k and 15k per person. Although courts normally can add punitive damages. Would be hard to justify much over acutul lose when lost of life would be limited to 75k.

[tulsacubfan]

Insurance..............they have insurance thru Loyds of London for this...it won't cost Carnival anything except for some bad press

 

And some large deductibles.

[bobnsons]

No. Pilots do not drive cruise ships. They provide advice. The Captain is still in control of the ship.

 

 

My dad retired from the Merchant Marine many years ago and I can still remember a story he told me about coming into New York. At the time Daniel Ludwig was one of the worlds biggest shipping magnets. His motto was a merchant ship can not make money going backwards.

 

He was able to save money on building his ships by skimping on making the reverse of the ship only 20% power instead of 100%. When you put the ship into full astern (reverse) it only had 20% of the power of full foward. If you wanted to slow or stop the ship when coming into port you had to start slowing down about 3 or 4 times sooner than it would take a normal ship.

 

One time coming into New York they took on the pilot. The capatian explained about the Ludwig ship and only have 20% power at full astern. The pilot really didn't pay much attention. About 10 minutes went by and the captian again reminded the pilot. This time the pilot told the captain he knew what he was doing.

 

After after the point it needed to start slowing down, the captian once more tried to explain to the pilot they could not slow down to dock. The pilot told the captian he was running the show.

 

Finally after way too late the pilot gave the order " full astern". They obeyed and the ship kept moving forward as if nothing had happened.

 

Then the pilot wanted to know what was wrong and why the ship was not slowing down.

 

Thanks to pilot not listening they were able to take emergency measures and just clip the end of the dock they were susposed to dock at and continuted up the Hudson another 4 miles before the ship came to a halt.

 

Pilots have the authority but in the long run they don't have the responbility. It's a most coveted job for one to have.

[cdamion]

Acutually cost if all 4200 sue will be closer to $50,000,000, Costa has already said that all on board will be reciving refunds in full. And although 75k is the max. The apx. 36 dead, (based on 11 dead and 25 missing as ogf the last report I gheard), the remaining on board will have claims on injuries and lost personal items. Which ussaly average out to between 10k and 15k per person. Although courts normally can add punitive damages. Would be hard to justify much over acutul lose when lost of life would be limited to 75k.

 

I think this is a case where they are going to pay out well over the 75k limit with respect to the wrongful death claims. The inconvenienced passengers will probably hit the 75k limit unless there was some type of severe injury.

 

This is a very arguable gross negligence case.

[tulsacubfan]

There is a Business Interruption Insurance that may help

 

BUT

 

As a Real Estate broker and as many car insurance policies prove

When you have a large claim your policy skyrockets

 

That will be reflected in increased fares...sadly

 

Its Business :mad:

 

The article I read on PropertyCasualty360.com stated they were self insured for business interuption.

[regjr13]

Oh my the people at Carnival have taken the emergency steps of crunching the numbers to get an idea of weather they will be able to get a big bonus.

 

If the Carnival people really do read this board, please tell the guys in the main office this is not the way to handle such a tragedy.

 

Well spoken! I can't even imagine reading they have already placed a dollar amount on the tragedy of lives lost. It just goes to show you, thinks happen, but wow, another Carnival issue. A year ago it was Carnival Splendor with no power stranded at sea. In 2009 it was a fire on Princess. Shaking my head...now it's the Costa Line. My thoughts and prayers are with the families of those lost.

[firefly333]

The article I read on PropertyCasualty360.com stated they were self insured for business interuption.

 

I too read Carnival is self insured for business interruption.

 

People seem to be grasping at straws to mimimize the hit to Carnival. I too have read the glib replies that insurance will cover this, dont worry, be happy.

[H82seaUgo]

The muster must take place within the first 24 hours. I believe I read that it was scheduled for the next morning.

 

the woman on the today show this morning stated it was scheduled for 5 pm the next day.

[H82seaUgo]

I too read Carnival is self insured for business interruption.

 

People seem to be grasping at straws to mimimize the hit to Carnival. I too have read the glib replies that insurance will cover this, dont worry, be happy.

 

i swear, the lemmings over on the brand ambassador fb page would be sending in cash if he asked them to.

[tulsacubfan]

I too read Carnival is self insured for business interruption.

 

People seem to be grasping at straws to mimimize the hit to Carnival. I too have read the glib replies that insurance will cover this, dont worry, be happy.

 

You are so right. And I guess these people don't realize that insurance is paid for by the premiums Carnival Corp (and others) have paid (and yes, the investment of those premiums).....kind of like "the government will pay for it".....where do they think the government gets its money? Same thing....where do they think the insurance carriers get the money?

[big_duck]

....where do they think the insurance carriers get the money?

 

Prudent management of their investment portfolio.

 

Here is a logic conundrum for you. If an insurance company holds CCL stock in its portfolio should it increase the premiums? They would after all be charging themselves more.

[zqvol]

Nor does it include the cost(s) of the assorted passenger lawsuits.

 

I am willing to be dollars to donuts that NO ship from any line will be leaving the pier w/o a FULL, old fashioned (inc life jackets) muster drill and staff/crews will be having them weekly for at least 6 months and monthly after then.

 

 

There are not going to be many of those. This matter is not governed by US law and the maritime laws are very different in other parts of the world. The only people who have even a slight chance of prevailing in a suit are the few US passengers

[firefly333]

There are not going to be many of those. This matter is not governed by US law and the maritime laws are very different in other parts of the world. The only people who have even a slight chance of prevailing in a suit are the few US passengers

 

I hear they are supposed to file in Italy. You dont think any of those Italian pax have a chance of winning a lawsuit?? I bet there are some out of court settlements you dont hear about.

 

Who knows, its too early to know the finacial impact.

[big_duck]

I hear they are supposed to file in Italy. You dont think any of those Italian pax have a chance of winning a lawsuit?? I bet there are some out of court settlements you dont hear about.

 

Who knows, its too early to know the finacial impact.

 

Without knowing how the Italian justice system works, I would guess that a class action will be filed, the lawyers and insurance actuaries will sit down at a big table and hammer out a settlement amount (probably with a non-disclosure agreement).

 

I sincerely doubt this will ever see the inside of a courtroom.

[mjl1960]

According to the Guardian newspaper in UK, Carnival Corp has announced that it is going to take a $90 million hit in 2012 earnings from loss of use of the Concordia. This does not include recovery/salvage/environmental costs.

 

Here is the link:

 

http://www.guardian.co.uk/business/2012/jan/16/cruise-ship-owner-warns-sixty-million-hit?INTCMP=ILCNETTXT3487

There goes the chocolate melting cake.... :(

 

It also don't cover the cost of the lawsuits that will be coming.

[freewilly]

We were sailing on the Grand Princess in the Med in 08. We went from 20 plus knots to a dead stop. The ship was full of broken glass, we heard a fire announces over a crew radio, and in general the crew was very hush, hush as to the constant grinding sound and slight listing of the boat. We limped into Chichivecchia (sp) at 5 knots, many hours late and very sea sick... We had no compensation from Princess except a comp. call to rearrange travel from port. We passengers had theories from Rocks to Rogue waves. It was a scary night at sea... My heart goes out to the passengers and crew of the wrecked ship...