Oceania Cruises confirmed last night that a crew member and two contractors died following an engine room fire on the ship Insignia in the Caribbean.

One member of crew remains in the hospital and is reported to be stable following the blaze which occurred while the ship was in St Lucia.

“The fire was contained to the engine room and extinguished. All guests are safe and have disembarked the vessel,” the luxury line said.

“Three crew members and two contractors who were working onboard were transferred to a local medical facility.

“We are deeply saddened to learn that two contractors and one crew member did not survive. We extend our deepest condolences to their families during this very difficult time.”

All 656 passengers are safe with charter flights arranged to fly them to Miami, as well as transfers and hotel accommodation until flights to their home cities can be organised today (Friday).

The 10-day cruise, which departed San Juan, Puerto Rico on Sunday and was due to arrive in Miami on December 17, has been cancelled.

It is not known if there were any Britons on board the vessel, which was refurbished earlier this year following a two-year charter to Hapag-Lloyd Cruises.

Insignia originally entered service in 1998 as one of a series of identical small ships built for the now defunct Renaissance Cruises.

Oceania said: “Our top priority is ensuring all 656 guests return home as quickly and comfortably as possible.

“All guests will receive a 100% refund, and a 50% credit towards a future Oceania Cruises voyage.

“Oceania Cruises president and chief operating officer Jason Montague, along with a team of guest and crew support and technical personnel, are in St Lucia.

“This team is leading the effort to ensure guests and crew are well cared for, as well as working with the ship’s team and authorities to assess the situation.”

More details will be made available as they become known, the line added.