What happened?
On September 09, 2025, the Zim-operated Mississippi lost a few (approximately 75) containers overboard while at berth in the Long Beach Port. The reason there is wiggle room on how many containers were involved is that not all the containers that jumped overboard could float. As of today, no one has a firm number of containers sitting on the floor of the harbor near Pier G.
Why did It happen?
There are plenty of experts citing the reason why it rained containers in Long Beach, and most of the guesses will be close, if not right on target. Once the list of things that did not cause the accident is ruled out, the rest of the list is not that long. There were no rough seas or severe weather reported from the port of exit in China to the port of entry (Long Beach) in the USA. The sailing was a direct sailing with no other port of call. There were no collisions, groundings, or abnormal listing (tilting) reported; in short, to this point, there are no known outside influences tied to a root cause for the containers taking a swim.
After thinning down the list to what is possible, there is human error, mechanical failure, or a combination of both. Mechanical failure can be things such as faulty twist locks, lashing bars, or turnbuckles failing, which can cause slack, allowing lateral and vertical movement. Human error could be locks, lashing bars, or turnbuckles not being applied properly, or the vessel being loaded improperly with heavy containers high and light containers low. Early reports indicate that the containers began falling after the crew started releasing lashing straps, suggesting the problem existed before a dockworker touched the first strap. It at least appeared that those cans, or at least some of them, were already leaning, causing a domino effect that many of us saw on video. It will take a while, but the actual causation will come out.
The next big question is, who pays?
It is obvious that one week ago, Tuesday September 9th, was not a good day for vessel operator Zim Shipping Lines or the vessel owner Ocean Yield, ASA out of Norway. Both of their checkbooks ran out of the room screaming when the containers hit the water. You don’t throw all sorts of stuff in the water in California and still have a good day. When containers fall into the water in the middle of the ocean, there isn’t much clean up. Because the vessel was in the harbor, the clean-up costs alone will be significant enough to make their insurers pay attention. In addition, every shipper with no cargo insurance with a box in the water will be calling their lawyer, the smart ones who had cargo insurance will call their cargo insurer, and cargo insurers will be looking for subrogation down the road with intentions of getting some of the claim money they paid back from the vessel owner and vessel operator.
Here is how the cargo insurance shakes out.
No Cargo Insurance
If you did not have cargo insurance on your shipment, sorry. Even if you can prove liability to the carrier, it will be a long road getting there, and good luck being made anywhere near whole. The ocean carriers cast aside most uninsured shippers. I know a great firm (Recoupex (3) Recoupex: Overview | LinkedIn) that specializes in claims against carriers. I highly recommend them.
Insured Cargo
If you had cargo insurance on your shipment, congratulations; your decision to insure served you well. If your shipment was insured with ICC Clause A all-risks cargo coverage, it covers the peril of falling overboard. Get your paperwork together and file your claim. If your shipment was insured with ICC Clause C (Sometimes called FPA) insurance, call your insurance provider. The Clause C/FPA version of cargo insurance often does not cover falling overboard. If you did not have ICC Clause A all risks, but had Clause C instead, you may want to save the link above to Recoupex and again call your provider.
Will General Average be declared?
First, let me address what General Average is. The simplest way to put it is that General Average is a maritime law that enables ocean carriers to require all shippers with cargo on a vessel to cover losses, including cargo and the vessel itself. In 2017, I wrote an article for LinkedIn Pulse on General Average https://www.linkedin.com/pulse/everything-you-wanted-know-general-average-were-afraid-tom-o-malley if you want to read up on it. If you don’t like my article on the subject, there are about 13 million more General Average articles online for your review.
Okay, let’s get back to it. General Average or no General Average?
The vessel’s controlling parties, which include the operator, the owner, and insurers, have a say on whether they will declare General Average. Once General Average is declared, the ocean carrier won’t release anyone’s cargo until they have a payment or bond of some sort. There have been some questionable General Averages declared over the years; it generally suits the ocean carrier to declare General Average. I am no expert, but I don’t see General Average being a factor on this occasion. The accident and loss do not fit the criteria to declare General Average (GA). When I say, ‘not fit,’ I mean like the suit I got married in, not fit. Like, not fit as in not fit at all, so why even try?
First, GA dictates that a deliberate sacrifice of value be made to save something of more value. An example would be jettisoning 50 containers to save lives or to save the voyage. In our case, the containers fell off the vessel by accident; there was no intentional sacrifice. Moreover, to declare GA, there must be an imminent peril. In our case, 75-ish containers fell off the vessel. There were no known perils before or after. Lastly, the act must aim to preserve property or safety. Since we don’t even have an intentional act, there cannot be an aim to preserve anything.
In my opinion, while the principles can declare GA, the number of shippers and insurers that would go to court to contest the GA would be huge. The court would immediately rule that the accident did not even come close to meeting the requirements of GA and may even chastise the vessel’s principals for even trying to declare GA in the first place. With that in mind, I think General Average is a non-starter.
Containers fall off vessels pretty often. What makes the Mississippi’s occurrence different is that it was at the port of Long Beach for us all to see, and at the same time, it created cleanup efforts that would not necessarily be there under other circumstances. For this reason, we all get a bird’s eye view of the process and are more likely to hear about it in the news. We should all appreciate being ‘in the know’.