Marine insurance review notes piracy 22pc down, but ransoms 77pc up
2012 04 24
- Details
ANTI-PIRACY security measures are proving more effective with 20 per cent fewer successful attacks in 2011 year on year, but ransoms demanded have increased 77 per cent from 2010, according to the Willis Marine Market Review.
London shipbroker Willis Group's review said cargo insurance buyers continue to enjoy the benefits of a soft market, achieving reductions in premium and deductibles, as well as increases in limits, at little or no additional cost.
"Despite ever-dwindling returns to insurers, competition for business remains fierce with a flurry of new entrants creating excess capacity," the review said.
"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," said Willis Global Marine CEO Alistair Rivers.
"For many, the year began badly with the loss of the Costa Concordia cruise liner [off Italy in January with 32 dead]. It was a timely reminder that 100 years on from the loss of the Titanic, disasters on this scale are still possible. The liability aspects of this loss will be of far greater significance to insurers as matters evolve throughout the year," he said.
The review reported February's insurance renewals were "disproportionately confrontational and protracted" as shipowners operating in one of the worst economic environments for a generation contested even inflationary increases. "On average, rate increases of four per cent were achieved," the review said.
Excess capacity in the Asian marine insurance market is putting pressure on rates as local and foreign insurers compete for market share. Asia is now home to half of the insurance world's merchant fleet, 14 of the top 20 ports and three of the largest ship building nations, said the review.
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