A reliability-based model for assessment of deteriorating ships subjected to multiple environmental conditions is established. Deterioration due to combined crack growth and corrosion in structural components of a ship hull is accounted for based on a fracture mechanics formulation. The model enables to take into account the corrosion-induced increased crack growth rate in two ways: (1) the increased stress range produced by the plate thinning (wastage) effect and (2) corrosion fatigue itself. Sensitivity studies are carried out to evaluate the effect of inspection updating on a production ship subjected to two different climate conditions. The hazard rate concept is adopted as a measure of reliability and emphasized throughout the different case studies.