If you work in the marine sector and operate a vessel that trades in the United States, you may be required to get a COFR insurance policy. COFR, short for Certificate of Financial Responsibility, ensures that you are able to pay for associated costs in the event of an oil spill. Noncompliance can have steep costs, so it’s important to get the coverage you need. Here are the essentials to keep in mind.
COFR May Be Required
In certain cases, having a COFR is required. You may be required to get a COFR if you are:
- Operating a vessel of over 300 tons using US waters
- Transshipping oil in the US Exclusive Economic Zone
There are also a few exceptions to be aware of. If you operate a public vessel or barge and you do not carry hazardous substances or oil, you may not be required to have a COFR.
Noncompliance Results in Harsh Penalties
While it might seem like an extra cost or hassle to get COFR insurance, noncompliance can result in some harsh penalties. Possible penalties risked include detainment, forfeiting your vessel, being denied entry at your destination or having to pay a fine of up to $30,000 a day.
Running a trading vessel involves certain liabilities that may require you to have a Certificate of Financial Responsibility. In order to ensure compliance and avoid steep penalties, you may want to look into finding the right COFR insurance policy for your company.