Marine insurers are facing a continued challenge as the global economy struggles to recover after two years of recession.
As the world’s marine underwriters prepare for the International Union of Marine Insurance’s (IUMI) annual conference in Zurich, concerns of the impact of the economy on global trade and with it maritime coverages continues..
IUMI predicted in January that if a recovery in the shipping industry was to take place this year; it would be painful and slow.
The conference comes at a time when the global economy is struggling to recover from the worst recession in a generation, coupled with fragile freight markets and the aftermath of one of the most damaging environmental disasters in recent times, the Deepwater Oil Horizon disaster.
The conference organisers are now suggested that this may cause marine underwriters to question whether the recovery has all but stopped and what the implications may be to market size and the ability to drive premium rates to sustainable levels.
IUMI President Deidre Littlefield spoke of a critical period for both ship-owners and marine underwriters in the next decade.
She said “Despite the increase in capacity due to the influx of new tonnage, much of which was ordered when owners were riding the boom, paradoxically there are still new build orders being placed, especially by Greek owners. Yet many owners need urgently to refinance a considerable amount of debt, so the future for some operators is a hard one to call.
“For underwriters, statistically speaking, a much younger profile for the world fleet should signal fewer ship casualties and claims. At the same time, however, we can anticipate landslide changes in shipping over the next 10 years as vessels and ports expand in size and a whole new raft of technological advances fall into place, making ships increasingly more complex to operate”. The conference offers a broad range of contemporary issues in marine insurance from renewable energy to the very future ofdeepwater drilling.