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Daily Insurance Industry News
Wednesday 25th of April 2018
April 23, 2012

Willis: difficult year for maritime industry

by Gill Montia

Story link: Willis: difficult year for maritime industry

Willis is forecasting another difficult and uncertain year for the maritime industry, bearing in mind Costa Concordia, further problems in the eurozone, pirate attacks and increased sanctions.

According to the broker’s latest Marine Market Review, the Hull market is in a state of flux following the Costa Concordia disaster, and some underwriters in the London insurance market, which will bear the bulk of the estimated $500 million hull claim, are refusing premium reductions or even flat renewals.

Unaffected underwriters in the Far East and Scandinavia are more open to negotiations but marine liability underwriters generally are hoping the disaster will drive through a hardening of rates, with many seeking 5% increases going forward.

Meanwhile, cargo insurance buyers continue to enjoy a soft market, achieving reductions in both premium and deductibles, as well as increases in limits, at little or no additional cost.

The report also notes that security measures taken by ship-owners are increasingly effective with less than 20% of pirate attacks successful in 2011, although where attacks occurred total ransoms were up 77%, compared with 2010.

Alistair Rivers, chief executive officer of Willis Global Marine, sums up: “These are difficult times for the maritime industry: world shipping is in recession; the economic turmoil continues to dampen demand; pirates are seizing property and crew; and increased sanctions demand further resources and attention.

“But maritime trade has seen and overcome similar challenges in the past and the entrepreneurial spirit that drives the industry remains intact.”

 

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