As we expected, 2023 has been a very busy year for marine insurers with a number of issues impacting significantly across all lines of business.
The Black Sea corridor initiative agreement was not extended and ended in July after a 12-month period over which the BSCI allowed more than 1,000 ships to export in excess of 31 MT of agricultural product to the rest of the world.
Since then, Ukrainian exports have started up again using a new Ukraine corridor but, at the same time, Russian attacks have concentrated on Ukrainian harbour loading facilities on the Danube River and in the vicinity of Odessa. Ships have also been attacked whilst loading at Ukrainian ports.
The war, together with other geopolitical issues, were discussed at our Edinburgh conference which was a real success attracting over 700 attendees.
During the conference’s working sessions, clear analysis was presented on the state of the marine insurance markets through the Facts & Figures statistics and highlights given on the 2022 premium base.
Premium levels have shown a clear increase but such a positive statement was balanced by open questions expressed about the strength of the present international economic and geopolitical situation around the globe.
Marine risks and the general economic situation are largely exposed and can suffer from fragmentation directly caused by a nationalistic approach being taken by a growing number of states for the sake of strategic industrial advantage. This is generating a large scale of onshoring or reshoring industrial production - and the consequences on marine insurance is still to be assessed.
But what marine insurers can offer is not only about numbers and finances; skilled and diversified staff are able to understand this evolution and the vital importance of preparing for the future. This was demonstrated and explained at length during various workshops during the annual conference.
The evolution of ESG and in particular IMO’s recent decision to reduce shipping’s GHG emissions to assist with the fight against global warming was also considered in Edinburgh. Shipowners are having to reduce their consumption of fossil fuels to align with the new IMO 2050 policy. Whilst this shift is only beginning, marine insurers will need to ensure they understand the various technical solutions (which are backed by prominent charterers) and which will develop into all aspects of maritime logistics.
Unfortunately the Gaza-Israel war has revived a tragic situation and once more put pressure on marine insurance in relation to Middle East areas and the Gulf and Straits shipping routes. These are so important for maritime traffic; and as a strategic route to export oil into Asia and Europe.
The challenge for marine insurers is to work within this complex context where industrial and technical evolution has to be considered alongside a resurgence of war and an increasingly fragmented world.
Within this mixed situation, IUMI will support its members in the months to come and use the opportunity of the Berlin conference not only to celebrate our 150th anniversary but also to assist insurers adapt to this new and rough environment.
But before meeting again next year, let me wish a very peaceful and happy new year to all those who are facing this fascinating changed world of marine risk.
