In Massachusetts: On the Beach

By Peter Stoler

The sun is high, the weather clear and, according to the National Weather Service, likely to stay that way for several days. Salvatore "Sam" Favaloro, 60, should be out at Georges Bank, some 160 nautical miles from his home port of Gloucester, Mass., fishing for cod and haddock in his 70-ft. trawler Cara Lyn. Instead, he is tied up at a dock in Gloucester's inner harbor, worrying about how he is going to pay for the parts he needs for Cara Lyn's engine.

Ed Boynton, 37, should be out working too. But he is perched in the wheelhouse of his 50-ft. Sissel B, entertaining his six-year-old son Lars. Sam LoGrasso's boat, the 71-ft. Italia, sits at its dock while he, just as idle, soaks up the warm summer sun outside the St. Peter's Club.

More than 30 Gloucester skippers and their crews have been unable to work since early July. Dozens more, perhaps as much as a third of Gloucester's 160-boat commercial fishing fleet, once one of the nation's primary providers of fresh fish, could find themselves idle before summer gives way to fall.

Gloucester's men have been suffering for years as declining stocks and stringent regulations have cut down on their catches. But the fishermen who are staying in port these days are doing so because they cannot get or afford insurance for their boats and because, in most cases, they cannot sail without it. "I don't know what to do," says Favaloro, spreading huge hands scarred by a lifetime of handling nets and lines, and relating how the cost of his insurance has doubled since 1981. "Either I borrow on my house to buy insurance or I leave my boat at the dock and lose both my boat and my house. It's a gamble, and either way I lose."

Leonardo Taormina, 42, has been told that he must pay $52,000 for the same coverage he could barely afford last year at $22,000. "There's no way I can pay that and make money," he says. Because the price of fish is based on auction prices at the Boston Fish Pier, he explains, fishermen cannot simply raise their prices to pass along increased costs. Nor can Mark Godfried, 49, meet the cost of coverage for his 50-ft. Stella G. After spending more than $20,000 converting the craft from a side trawler to a more efficient stern trawler, he was told that his premiums were rising by 70%. "That just put me on the beach," he said. Godfried bought a port-risk policy, which covers his boat only as long as it remains tied to a dock, and took a job ashore.

Some Gloucestermen bitterly blame their plight on the insurance companies, whom they perceive as greedy and heartless. But many concede that the premium jumps are justified. "In a way," says Joseph Giacalone, 52, whose 74-ft. St. Peter, built in 1927, is one of the oldest boats in the fleet, "I guess you could say that the fishermen, or at least some of them, brought this on themselves."

Fishing, which involves going out in rough weather and working with dangerous equipment on slippery decks, is risky under the best of conditions. But in recent years the trade has seemed particularly hazardous to companies insuring boats sailing out of Gloucester. A 1920 federal law, the Jones Act, allows any fisherman injured aboard a boat to seek compensation from the owner. Some of the claims filed under this act have been colossal. In one case a Massachusetts jury awarded $525,000 for a badly broken arm to a boat owner who brought suit against himself. (The judgment, however, was later reduced by the court.)

Taken by themselves, the rising claims would make insurance companies think twice about covering Gloucester boats. But the past five years have seen a rash of sinkings as well. After studying U.S. Coast Guard records, the Gloucester Daily Times found that between January 1980 and July 1984, 35 local boats had gone to the bottom, more than double the number from New Bedford, Mass., the town's chief rival as a fishing port. What made matters worse was that 24 of the boats sank in conditions that the Coast Guard described as "calm." "We can't prove that all of these people scuttled their boats for the insurance," says a Coast Guard official, "but the situation sure looks suspicious."

Insurance companies noticed that some of the same names seemed to recur on the lists of sinking vessels. "The word got out that Gloucester was a high-risk operation, that it was something of a bad joke in the marine-insurance business," says local Broker David Amero. "The companies decided that they didn't need the bad publicity or the losses." As a result, only one of the five companies that used to write insurance on Gloucester fishing boats continues to do so. But even it has canceled coverage on many boats and charges high rates for those it continues to insure. "It's not greed; it's self-protection," says Amero.

Brian Tarr, president of the Cape Ann Commercial Fishermen's Loan Fund, which serves as lender of last resort for many of the port's owners and captains, recently suggested that Gloucester's fishermen form a self-insurance system, taking the $3 million to $4 million a year they would normally pay in premiums and creating a fund to cover claims. But few fishermen responded. Only those without insurance approved the idea; those who were still able to obtain and afford commercial insurance shrugged off the problem. Their response did not surprise Boynton, who feels that an inability to take the long view has always been the fishing community's main flaw. "Fishermen," said Boynton wryly, "are living proof that fish is not brain food."

Boynton may be wrong. No one in the town, from fish processors to merchants, wants to see the local fishing industry die. But even the fishermen are beginning to realize that only they can save the Gloucester fleet. --By Peter Stoler