The marine cargo insurance market is stable, but uncertainty remains.
This was stated by Mike Brews, Chairman of the Iumi Cargo Committee – International Union of Marine Insurance during the association’s annual assembly just held in Singapore.
According to the latest Iumi research, global insurance premiums for cargo transport in 2024 reached 22.64 billion dollars, an increase of 1.6% compared to the previous year. This steady growth confirms a multi-year positive trend. It is encouraging for insurers to note that cargo loss ratios – the balance between premiums collected and claims paid – have steadily improved in most regions since 2018. The claims environment has also remained relatively favorable, with no significant catastrophic losses reported in 2024.
“The cargo market remains stable in terms of global premium collection. This year we have seen a particularly significant jump from China, although much of this is likely due to a correction of previously underestimated insurance returns. That said, our sector continues to face ongoing challenges, including cargo accumulation, misdeclaration of shipments, the transition to net zero, and war-related risks. However, overall, 2024 did not bring any unexpected shocks,” commented Brews.
Looking to the future, Brews conversely highlighted the growing impact of tariffs:
“Tariffs are just beginning to be felt. In the coming months, we will closely observe how they reshape the value of insured cargo and whether shippers and consignees shift towards new markets and destinations to circumvent them. These changes could alter the entire landscape of cargo transport.”
According to Brews, tariffs could increase the insured value – and the related risk accumulations – by up to 50%, particularly in North America. Other regions could also be affected, depending on where the risk transfer occurs within global supply chains. Changes in trade flows could disrupt established transport models, forcing insurers to adapt to new routes, ports, and storage facilities, each of which involves different risk profiles.
Brews also addressed market performance trends: “We are definitely seeing an increase in market capacity. Some underwriters are now taking on greater risks at competitive premiums, which inevitably leads to some market softening. However, I do not expect as sharp a decline as some predict. Cargo underwriting remains profitable and this is attracting new investment.”
Despite the current period of relative stability, Brews concluded by arguing that tariffs and broader geopolitical tensions could still cause significant disruption: “If these forces reshape trade routes, costs, and volumes, the stability and profitability of the market will undoubtedly be under pressure.”
