The International Union of Marine Insurance (IUMI) held its 150th annual conference in Berlin, Germany, marking a significant milestone in its history. The conference, chaired by various industry leaders including Frédéric Denèfle and Ilias Tsakiris, shed light on the evolving landscape of marine insurance amid global changes and challenges.
Frédéric Denèfle, IUMI President, inaugurated the conference with a reflection on the organization’s 150 years of facilitating global trade through marine insurance. He underscored the profound changes sweeping across the marine insurance sector, driven predominantly by geopolitical tensions and technological advancements.
Denèfle highlighted the emerging risks from ongoing war, sanctions, and trade embargoes, which are rerouting traditional shipping lanes and pushing marine operators towards longer and riskier sea routes around Africa. This shift raises concerns about navigational challenges, increased operational costs, and heightened environmental impacts.
He also pointed out the necessity for insurers to adapt to the evolving global market dynamics and the nearshoring trends reshaping cargo shipments and logistic chains.
Ilias Tsakiris, chairing the Ocean Hull Workshop, reported a 7.6% growth in global ocean hull premiums in 2023, totaling USD 9.2 billion. This increase was attributed to heightened shipping activities and the escalating value of vessels driven by technological advancements.
Tsakiris emphasized the industry’s adaptability and the need for responsiveness to the fast-evolving external environment. Despite the positive growth, he cautioned about the influx of new market players and the increase in claims frequency and cost, which posed potential challenges for the future.
The geopolitical tensions, particularly in the Middle East and the Red Sea region due to Houthi rebel activities, were noted as significant factors disrupting global trade routes, prompting insurers to reassess risks associated with longer detours around conflict zones.
The conference revealed a broad uplift in marine insurance premiums across all lines of business, with a total increase of 5.9% in 2023, reaching US$38.9 billion. This growth was seen across cargo insurance, ocean hull, and offshore energy sectors, with cargo insurance experiencing a 6.2% increase, reflecting continued global trade expansion.
Astrid Seltmann, Vice-Chair of IUMI’s Facts & Figures Committee, explained that the rise in premiums was linked to increased insurable volumes and values, particularly in cargo and hull values. The geopolitical landscape and market conditions like capacity and pricing dynamics were significant influences on the insurance premiums.
Leaders at the conference were optimistic about the sector’s ability to navigate future uncertainties, despite the evident challenges. The shift towards more sustainable shipping practices, including the adoption of dual-fuel vessels and alternative fuels, was discussed as a crucial strategy in response to international environmental regulations.
The industry is also bracing for the impacts of climate change, technological shifts in vessel operation, and cyber risks that are increasingly pertinent.
In conclusion, the 150th IUMI conference underscored a year of growth tempered by significant challenges. The marine insurance sector continues to show resilience and adaptability in an environment characterized by complex geopolitical dynamics and rapid technological changes.
As the industry looks forward, the focus remains on innovating and enhancing underwriting practices to navigate the evolving risks and opportunities in global maritime trade.
