Real cost of piracy is unknown
A new study by the Actuarial Profession has stated that the actual cost of piracy remains uncertain.
The lack of statistical evidence regarding maritime piracy makes it difficult to assess risk and formulate appropriate insurance policies.
Each individual attack is thought to cost around £5.68m ($9m).
Actuary and report author Neil Hilary has stated that the frequency of piracy has increased by 125% since 2006, and that the practice of piracy is almost entirely down to Somalian pirates raiding off the Horn of Africa.
Hilary described the challenge of pricing maritime insurance products for actuaries as considerable, with relatively small numbers of attacks taking place despite the number more than doubling in the last four years.
Last year Lloyd’s of London revealed that gun usage in Somalian piracy was twice that of 2008.
In the first nine months of 2009 Somalian pirates captured 661 people, and killed six of them.
Category: Insurance News
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