Industry-wide cooperation, knowledge sharing vital for net zero: IUMI

Global ocean hull premiums rose in 2022 by 5.7% to reach $8.4bn, delegates attending annual gathering of the International Union of Marine Insurance (IUMI) were told. This was largely due to a combination of growing activity, increased vessel values and reduced market capacity. Claims for the same period remained moderate although early 2023 has witnessed a modest increase. Taken together, this has had a positive impact on overall loss ratios that have enjoyed a downward trend for the past three years with 2022 ratios starting out at the lowest point since 2015.

Aside from inflation, three other key issues are currently demanding attention from hull insurers: alternative fuels, lithium-ion batteries and the growth of the so-called dark fleet.

Turning to lithium-ion batteries and electric vehicles and the spate of fires seen at sea, IUMI warned such incidents are becoming more common in recent years and action was needed.

“There needs to be comprehensive cooperation and knowledge sharing between owners, class, flag states, underwriters and others. This will be particularly important as the first movers begin implementing new technologies which will then, inevitably, be taken up by the remainder of the industry. It will be essential for a comprehensive regulatory regime to be in place before the bulk of the fleet starts to comply,” said Helle Hammer, chair or IUMI’s policy forum.

As far as the dark fleet goes, IUMI stated in a release: “Many report that Russia is managing to bypass insurance regulations, with approximately 20% of the global tanker fleet avoiding sanctions.” IUMI statistics suggest the dark fleet today is around 600-strong.