Carnival and insurers see losses mount

CRUISE operator Carnival saw over £700m wiped from its stock market valuation yesterday as investors and insurers counted the cost of the company’s Costa Concordia ship capsizing off the Italian coast.

Analysts at Espirito Santo said the disaster could be the biggest ship claim in maritime history, with insurance claims as high as $1bn (£653m).

Carnival faces an excess of $30m (£19.5m) on any insurance claim for damage to the ship and $10m (£6.5m) for personal injury liability cover. The lead underwriter is XL, while RSA and Generali are also understood to be exposed.

Yesterday Costa Cruises chairman and chief executive Pier Luigi Foschi (pictured) apologised for the tragedy and blamed the captain for steering the ship off course.

The firm said its stricken cruise liner will be out of action until at least November, costing the firm up to $95m (£62m) in lost profits. The firm also expects “other costs to the business that are not possible to determine at this time”.

The timing of the disaster is particularly damaging for the industry because a third of cruise holidays are booked in the “wave season” between January and March.

The Costa Concordia was carrying over 4,229 passengers and crew when it lost power late on Friday night and struck rocks near the shoreline, ripping open the hull. Six people are confirmed to have died in the accident so far while another 29 are still missing. The captain of the ship has been charged with manslaughter.

Yesterday afternoon rescuers evacuated the ship after it began to slip down the rock ledge into the sea, raising fears of environmental disaster or a larger insurance claim if its fuel tanks leak.

Wyn Ellis, an analyst at Numis Securities, said that the cruise business should expect a “horrible year” but insisted it remained a good investment.