Iumi's marine market trends
The International Union of Marine Insurance (Iumi) recently presented its analysis of the latest marine insurance market trends for 2019. Marine underwriting premiums for 2019 were estimated to be USD 28.7 billion, which represents a 0.9% reduction from 2018.
The global premium base for the cargo market for 2019 was reported to be USD 15.6 billion – a 1.5% reduction from 2018. Loss ratios in Europe for the years 2014-2016 were particularly high, but all recent years up to 2019 were under the influence of an increasing exposure to nat-cat or man-made events combined with accumulations on ships and in ports which were not necessarily reflected in premiums.
2019 started at around 60%, which demonstrates a modest improvement compared with previous years and is expected to end slightly below 70% if the year follows a standard development pattern. Loss ratios in Asia were stable until 2014 but then increased dramatically to around 60% in 2018; there appears to be a slight improvement in 2019 with a loss ratio of around 50%.
In Latin America, the ratio is stable in the 50-55% range. Taken together, these loss ratios indicate the beginnings of a market recovery.
Philip Graham, chair of Iumi’s facts & figures committee, put the numbers into context: “The loss ratio figures as of 2019 suggest the start of a modest recovery in the hull and cargo segments and a continued fragile balance in the energy segment, but it is still early days and it remains to be seen how far Covid-19 will impact these trends going forward. Yet, in my view, the coronavirus pandemic has, in a few short months, digitally moved many industries, particularly the insurance industry, forward by at least a generation." (mw)