The 144th annual conference of the International Union of Marine Insurers (IUMI) ended in Cape Town with underwriters recognising that behind the positive messages action is urgently needed.
Maritime trade may well be on the rise, but it is not being matched by the rise in premium rates that is required if the market is to be sustainable in the medium term.
The risks posed by digitalisation and the opportunities that technology may well deliver were discussed, as were the benefits of better loss prevention and areas where new products could be created and sold. Outside the conference hall, all the talk was around the dire straits in which many find themselves.
With some significant names exiting the marine market, the hope has been that a withdrawal of capacity would signify the ability to raise rates. It is clear that this is not the case. When delegates are told hull rates at present are simply ‘unsustainable’ and that rising cargo exposures are not being matched by price rises to match, many will be scratching their heads at to what they can do to halt the slide.
Catch up with all the big stories from IUMI 2018
The reports of a USD680 million newbuilding loss following major damage to a 100 m superyacht at the Lürssen’s shipyard in Bremen did little to improve the outlook. Nor did the announcement of a mega merger between two of the world’s biggest insurance broking groups, which will place an ever larger amount of the global maritime business under the control of a single firm.
Lloyd’s is looking at the performance of its syndicates as it seeks to eradicate poorly priced business and several marine insurers are in its crosshairs after years of underwhelming results and pricing.
It makes for a situation where marine insurers are searching for a silver lining in the storm clouds that continue to gather, despite maritime trade seemingly moving in the right direction.