IUMI’s marine insurance stats reveal premiums rise

The International Union of Marine Insurance (IUMI) released its annual “Stats Report”, reporting on the health of the marine insurance sector.

Highlights from this year’s report included:

• Global marine insurance premiums in 2023 totalled $38.9bn - a 5.9% uplift on 2022. Development was seen across all lines of business. Drivers included a continued rise in global trade volumes and values (cargo), coupled with increases in vessel values (hull), or the increase in oil price encouraging more activity in the offshore energy sector.

• Ocean hull premiums were reported at $9.2bn, up by 7.6% on the previous year. More activity, more vessels, rising values and reduced market capacity were responsible. Claims continued to be low resulting in positive loss ratios for all regions, although 2023 loss ratios show some deterioration which can be attributed to inflation impact on repair costs. Fires on large vessels continues to be a concern.

• Premiums for cargo insurance reached $22.1bn representing a 6.2% uptick on last year and continuing the trend for market development in this sector. This was on the back of healthy global trade growth. 2023 loss ratios were also positive and started at their lowest point since 2017.

• The offshore energy sector continued its run of premium base growth - reflecting the rally in the oil price – and reported $4.6bn for 2023, an increase of 4.6%. Fortunately, increased activity had not yet resulted in substantially more claims and loss ratios were positive and relatively stable, although 2023 figures were starting from a higher point than in previous years and claims costs typically take several years to develop.

The report also provides an update on IUMI’s Major Claims Database which contains data from 2013 onwards.

Some 28 national insurance associations are now contributing and cargo observations total 6,400 representing $10.9bn spanning 12 data fields.

Hull data extends to 10,300 observations and $14.6bn in cumulative losses. Losses are analysed with respect to loss severity, frequency, location and cause.

Commenting on this year’s report,

“Our data relating to 2023 demonstrates positive market development for all lines of marine insurance,” said Lars Lange, IUMI secretary general.

“The global premium base continued to grow and this, coupled with a relatively benign claims environment, generated encouraging overall results for underwriters,” he said.

“Looking ahead, there are a number of headwinds likely to make themselves known this year and beyond. Geopolitical tensions and the continuing attacks in the Red Sea area and the Russia/Ukraine war are significant. Our transition to a cleaner and greener society will also impact heavily as will the continuing - and often tragic - increase in large vessel fires.

“IUMI will continue to keep abreast of the many challenges facing our sector and engage with the relevant agencies to ensure marine underwriters are aware and equipped to continue to provide the insurance services that global trade requires,” Lange added.