Insurers lose spark for lithium-ion boat batteries

Lithium-ion batteries are making inroads into the marine world as they offer many boating-friendly benefits over traditional battery systems.

However, the marine side of the lithium-ion industry is regarded by insurers as still in its infancy, and the risk of a “thermal runaway” – a chain reaction that can see a faulty lithium-ion battery hit 600 degrees Celsius within seconds, setting fire to anything around it – is still high.

Related content:

A thermal runaway can be caused by a number of factors including incorrect charging or overcharging, a faulty cell in the battery, or even an electrical short.

The problem for boaters is that a lithium-ion fire cannot be extinguished using the firefighting equipment commonly found on boats, meaning that once the fire starts, unless its source can be removed from the boat, the fire is all but unstoppable.

While

However, while pressure is growing on the use of lithium-ion technology overseas, the batteries are yet to become a recognisable insurance risk in Australia.

Club Marine, one of Australia's largest recreational boat insurers, told boatsales.com.au it did not have any "conditions or restrictions" in its insurance policies relating to lithium-ion batteries.

"Club Marine has only had one claim related to a fire that was associated with a LiOn battery in the last few years but, even then, it is often difficult to attribute boat fires to a specific cause," Club Marine national claims service manager Sue Deeble said.

A spokeswoman for marine insurance group Pantaenius said its position on lithium-ion batteries in boats varied, and cover was provided on a "case-by-case" basis.

"Lithium batteries (or more specifically their failures) can be catastrophic so naturally there is caution around them, particularly now that more boat owners are installing them on their vessels," the spokesperson said.

"New boats are also more frequently being built with lithium systems onboard.

"From what we have seen and also discussed with industry experts, the main issue with lithium batteries on board is not the battery itself but rather the installation.

"We are finding that in most cases the installation of the batteries does not meet the Australian standards.

"If the Australian standards are met we can provide cover as appropriate. We do however only cover the LifePo4 lithium batteries at this point in time, they are the least volatile of the lithium battery chemistries," she said.

"We suspect that once the education around lithium batteries is increased and boat owners become aware of the specific requirements a lithium battery set up entails, we will see better installation practices and an even greater uptake of the batteries."

Several marine battery system suppliers were also contacted.

Lithium-ion battery systems have several advantages over lead-acid and gel-based batteries when used as house batteries.

These include:

On the downside, lithium-ion technology for boats is still considered to be in its infancy, making it expensive to adapt.

There is also a big difference in the quality of the battery technology used to ensure the lithium-ion batteries are safe in a range of operating conditions. Many also now include a monitoring system that can stop the charging process as soon as the battery is fully charged.

One of the big problems for boat owners if insurers do consider lithium-ion battery technology is a higher risk is self-installed systems.

Insurers tend to be averse to even the smallest chance something could go wrong and result in a claim, so a lithium-ion system may need to be certified by an approved installer before it is covered.

The risk of fire could also result in significant changes to how lithium-ion batteries are packaged on boats. Traditional battery boxes and bays are not very good at suppressing fires, and multiple lithium-ion battery installations may need to ensure the batteries are separated so that if one catches fire, it does not set off the others in a chain reaction.

A number of boat-makers are developing electric boats that use large banks of lithium-ion batteries to power their vessels.

However, these battery packs have been specifically developed for the marine environment, and while it can never be totally ruled out, they are highly unlikely to ever spark a fire.