ECAP

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ECAP
ENERGY CLAIM ADJUSTMENT PROTOCOL
A quantum step forward in handling complex claims.
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ENERGY CLAIM ADJUSTMENT PROTOCOL

• Indemnity based Assured contracts repairs
• Team approach maximizes the proactive efforts of
  the Assured and Insurers. Transparency of the
  process is essential.
• American Petroleum Institute (API) Recommended
  Practices form the agreed standards for damage
  evaluation
• The API Procedural format hastens damage
  assessment and expedites repairs
• The use of agreed standards simplifies the
  ultimate adjustment process.

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AMERICAN PETROLEUM INSTITUTE
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API Recommended Practice (RP) 579

• The ASME and API design codes and standards for
  pressurized equipment provide rules for the
  design, fabrication, inspection and testing of
  new pressure vessels, piping systems, and storage
  tanks. Fitness-For-Service (FFS) assessments are
  quantitative engineering evaluations which are
  performed to demonstrate the structural integrity
  of an in-service component containing a flaw or
  damage.

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API Recommended Practice (RP) 579

• The assessment procedures in this recommended
  practice can be used for fitness-for-service
  assessments and/or re-rating of components
  designed and constructed to the following codes
• ASME BPV Code, Section VIII, Division 1,
  Division 2
• (Fired and Unfired Pressure Vessels)
• ASME BPV Code, Section 1 (Power Boilers)
• ASME B31.3 Piping Code (Process Piping)
• ASME B31.1 Piping Code (Power Piping)
• API 650 (Oil Storage Tanks)
• API 620 (Low Pressure General Storage Tanks)

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EXPEDITING ALGORITHMS
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STEP 1 . ESTABLISH THE TEAM

• Agree on common goals. The intent of the Policy
  is to place the Assured back in the position he
  was in immediately before the loss.
• API standards provide independent guidelines for
  damage assessment and repairs. Insurers agree to
  provide technical expertise to implement the API
  procedures, in concert with the Assured.
• Transparency is critical. All parties must
  cooperate to achieve maximum benefit.
• Production of a common cause report is an
  important intermediate goal. Subrogation/recovery
  may be possible.

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STEP 2 . ASSESS THE DAMAGE

• Zoning overpressure heat exposure
• Prioritize vessel assessment schedule according
  to applicable zoning criteria
• Place orders immediately for critical items
  located in highest intensity damage zones
• Determine required repairs for vessels in lower
  intensity damage zones
• Sub-systems (piping, instrumentation, controls)
  assessed after critical vessels
• Investigate potential consequential effects to
  other units

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ZONES OF DARKNESS
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DAMAGE ZONE CRITERIA
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STEP 3 . CHART REPLACEMENTS AND REPAIRS,
PREPARE FOR CLAIM

• Scope of work documentation for the selected EPC
  contractor evolves directly from the API damage
  report.
• Order shorter lead time components (instruments,
  controls, etc.), now that major items are
  in-process.
• Engage accountants for BI, if applicable.
• Consider potential milestones and magnitude of
  partial payments.
• Collaboration as issues arise. Betterment
  issues may be likely, but addressable.

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STEP 4 . ADJUSTMENT/SETTLEMENT

• The Adjustment process is now almost an
  afterthought. Seriously contentious issues have
  been avoided by the team approach and use of
  agreed standards. By implementing this approach,
  the loss itself is minimized to the greatest
  extent possible. The Assured has retained
  control of the repair (by utilizing their
  selection of contractor and using their preferred
  engagement practices) and has been a critical
  team member in the damage assessment. Insurers
  have proactively engaged engineers and
  specialists to accurately assess the damage and
  develop the scope of repairs. Both parties reap
  the benefits of this precisely structured,
  transparent approach to handling the loss. No
  surprises!

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