IUMI reports steady insurance markets for hull and cargo in 2024, with headwinds now looming

Today, the International Union of Marine Insurance (IUMI) presented its analysis of the latest marine insurance market trends at its annual conference in Singapore.

Summarising, Jun Lin, Chair of the IUMI Facts & Figures Committee said: "The marine insurance sector is relatively stable but faces some strong headwinds, with geopolitical and trade tensions creating an unprecedented level of uncertainty across global trade. While growth in seaborne trade has slowed — partly due to tariffs and a normalisation following the extraordinary demand surge in 2024 — it is encouraging to see growth in cleaner fuel volumes outpacing those of fossil fuels.

“Whilst tariffs are having an impact, put in context, they are currently affecting less than 4% of global trade.

“Interest rates globally have already started to fall and the consequent reduction in inflation will likely impact overall profitability for most insurers. Similarly, the weakening US dollar will squeeze top line premium income and add to claims costs for those insurers paying out in non-US dollar currencies.

“At the same time, an ageing global fleet presents growing challenges, from machinery failures to increased maintenance demands and seafarer well-being. Claims were relatively benign in 2023 and 2024 but this year has seen an uptick particularly in groundings, large vessel fires and, of course, war-related losses.

“The relatively weak oil price continues to impact offshore energy prices and, consequently, insurance premiums. There has been a substantial pull-back in capex spend, particularly in the Middle East. We’ve also seen a dip in investment in offshore wind projects in 2024 but spend is expected to pick up this year and over the coming years.”