A Certificate of Financial Responsibility or COFR is filed with the U.S. Coast Guard on behalf of vessel operators that can cover costs and damages associated with marine pollution cleanup. The Oil Pollution Act of 1990 sets the liability limits that you’d be required to meet as an owner of vessels, marinas, cargo and other maritime business assets. Failure to be in compliance with the requirements of this program can result in costly penalties. It’s essential to have COFR insurance in place to help you protect your business.
Do I Really Need COFR Insurance?
You might think of a COFR as being analogous to a certificate of liability that a driver carries in a car or wallet, demonstrating that there is sufficient coverage for damages in the event of an accident. Having this type of coverage is recommended for various types of marine-based owners and operators:
- Vessel owners/operators
- Marina owners/operators
- Non-vessel owners
- Ship repairers and ship builders
- Yachts and yacht dealers
- Mobile drilling units
Violation of COFR rules may lead to daily fines of up to $32,500 which may result in serious financial consequences for you or your business.
What To Look for in a Provider?
As someone who has invested in maritime operations, you understand that there are risks and concerns specific to working with vessels in marine environments. You wouldn’t trust your coverage to any insurance provider. Similarly with COFR compliance, you’ll be better off choosing a provider that has a demonstrated track record of being experienced and knowledgeable about marine pollution protections.