Aon Launches 2008 Marine Review

by Stewart Douglas

Story link: Aon Launches 2008 Marine Review

Insurance group Aon has today launched its annual review of the Marine Insurance Market, which has turned up the likelihood of growing premiums for insurance providers in spite of an increased in the risks faced by the industry, according to the details published today.

According to the review, cargo markets are likely to continue to provide profitable pickings for insurers, whilst liability cover is also likely to continue to generate significant revenues in the current climate, despite the fact that the number of claims may soon grow as a result of probability and the small volume of claims recorded in recent years.

The abundance of supply within the market has been identified as a key factor in the likely competition set to emerge over the coming year, whilst the calm claims environment is reflective of growing trends towards improved security and cargo handling techniques within the marine shipping industry.

However the review did turn up several problems, identified as considerable risks to the marine insurance industry. One of the main concerns is the growing tendancy towards bigger ships with more expensive cargos and technologies on board, which could give rise to more substantial claims within the market when they do arise, from time to time.

Secondly, the review also identified a lack of talent within the industry as a potential for growing liability claims over the coming year, as cargo handling accidents look set to become more likely with potentially significant indemnity implications for the industry as a whole.

It remains to be seen whether the industry will continue to thrive within the low claims environment over the next twelve months, or whether the threats identified will come to bear, and what the consequences thereafter may be for the industry as a whole.