Global marine insurance premiums have reached a historic high, approaching $40 billion, a message delivered at the International Union of Marine Insurance (IUMI) conference.
According to a presentation by the organization’s internal statistician, Veith Huesmann, at the Singapore conference on Monday, the total premium income for this market segment in 2024 increased by 1.5% year-on-year to $39.92 billion.
However, a negative sign is the significantly slowed growth rate: the industry grew by 5.9% in 2023, while growth was 8.3% the previous year.
This finding aligns with recent broker reports indicating that rates in the main sectors of marine insurance, including cargo, hull & machinery (H&M), are softening.
Cargo insurance remains the largest class, accounting for 56.7% of all marine premiums; hull & machinery (H&M) insurance ranks second at 24.2%; offshore energy insurance accounts for 10.9%; and marine liability insurance accounts for 8.2%.
Factors influencing premium trends include: global trade activity and volume; fluctuations in asset and commodity valuations; currency movements and exchange rate volatility; political and regional developments affecting stability; and supply-side dynamics such as market capacity.
Regionally, Europe still holds the largest share, but its overall proportion is declining; meanwhile, the Asia-Pacific market (especially Chinese insurers) is growing, a trend IUMI views as long-term rather than a short-term change.
By country, the largest shares of the cargo insurance market come from China (17.6%), followed by Lloyd’s (9.7%), and the United States (6.9%); Brazil and Germany are both at 4.7%, slightly above the London company market’s 4.3%.
The Asia-Pacific market contributed 60% of global growth in 2024, and the gap between Asia and Europe is narrowing.
The loss ratio (incurred losses and adjusted /earned premiums) for cargo insurance has declined for the seventh consecutive year, continuing a downward trend.
The current situation appears to be that, in the absence of major one-off incidents, the level of routine claims remains attractive enough to draw capital, bringing new entrants and returnees. However, the resulting overcapacity is also intensifying competition in parts of the market.
The largest regions for the hull market are: the Nordic Group (12.9%), China (11.6%), Lloyd’s (8.7%), Singapore (7.9%), and the London company market (7.4%).
Unlike cargo insurance, the loss ratio for hull insurance is rising, having increased over the past five years.
Overcapacity led to initial signs of market softening in 2024; supply-side dynamics are characterized by the emergence of more Managing General Agents (MGAs) and an increase in follow markets.
Concurrently, increased diversions—particularly shipowners avoiding the Red Sea and rerouting via the Cape of Good Hope—have led to a rise in weather-related damage.
Other pressure factors include: the rising average age of the global fleet (with more owners choosing to delay scrapping) and cost inflation, both of which increase the likelihood of constructive total losses.
Assessing the P&I (Protection and Indemnity) situation is difficult as the International Group of P&I Clubs has introduced new reporting standards, excluding fixed premium products from statistics, making direct comparison with previous years impossible.
However, market information indicates that mutual premium growth between the /24 and /25 policy years exceeded 3%.
In the global offshore energy insurance market, the UK maintains its dominance: the London company market holds 31.6% and Lloyd’s holds 30%; Brazil and Mexico rank third and fourth with 8.1% and 8% respectively. The loss ratio for this sector has decreased significantly since 2020.
IUMI notes that given the high demand and utilization of offshore vessels, there has been a “significant increase” in perennial losses. Persistent overcapacity is causing market softening, putting downward pressure on premiums.
