Marine insurance is a specialized type of coverage designed to protect against financial losses related to maritime activities. Its primary purpose is to mitigate the risks associated with transporting goods and operating vessels across water. Traditionally, it is divided into three main categories: hull insurance for physical damage to the ship itself, cargo insurance for the goods being transported, and liability insurance (such as Protection & Indemnity) for legal responsibilities towards third parties. By providing a safety net against perils like sinking, collision, fire, or piracy, marine insurance is a fundamental component that enables and secures global trade.
Global marine insurance premiums surged to a record high of nearly $40 billion in 2024, yet this milestone signals a new era of moderated growth and complex challenges for the sector. While the market continues to be buoyed by robust maritime trade and a resilient offshore energy industry, it now navigates a far more turbulent sea of emerging risks. From escalating repair costs and persistent safety concerns to geopolitical instability and the pressures of decarbonization, insurers must chart a careful course between profitability and an increasingly volatile risk landscape.
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Market Overview
In 2024, global marine insurance premiums reached an all-time high of $39.92 billion, marking a 1.5% increase over the previous year. The figure, released by the International Union of Marine Insurance (IUMI), confirms the expanding value of maritime transport and offshore energy activities. However, the pace of growth slowed compared to the 6% increase in 2023, when premiums stood at $38.9 billion. This trend suggests that, after the boost from post-pandemic recovery, inflation of insured values, and rising freight rates, the sector is moving into a phase of more mature equilibrium.
Segment-Specific Developments
The main segments of the marine insurance market displayed differentiated performance:
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Hull insurance: Covering vessels, this segment grew by over 7% to reach $9.2 billion.
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Cargo insurance: Driven by the continued strength of global trade, premiums rose by more than 6% to $22.1 billion.
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Offshore energy insurance: Supported by ongoing investments in the oil and gas sector, as well as the energy transition, this segment exceeded $4.6 billion, up 4.6%.
These figures highlight how both traditional shipping activities and the offshore energy industry remain key pillars of the marine insurance market.
Claims and Emerging Risks
On the claims side, 2023 was characterized by relative stability, with a premium-to-compensation ratio considered favorable by operators. Still, there are persistent vulnerabilities. Rising repair costs, partly linked to inflation and the growing complexity of vessels, remain a critical variable. Fires aboard large container ships, along with broader shipping safety concerns, continue to pose substantial risks to insurers and shipowners alike.
Geopolitical and Strategic Pressures
Geopolitical developments add further pressure to the sector. Conflicts such as the war in Ukraine, attacks in the Red Sea, and uncertainties surrounding the navigability of key strategic maritime corridors have all impacted risk perception and insurance costs.
At the same time, the global push for decarbonization brings both challenges and opportunities. Investments in new technologies and alternative fuels are raising the complexity of risk management while reshaping the industry’s long-term outlook.
Outlook
The industry is currently in a phase of apparent stability: premiums remain at record levels, but the growth trajectory has become more moderate. Going forward, insurers will need to strike a delicate balance between profitability and managing evolving risks. External shocks, technological innovation, climate change, and geopolitical instability will continue to reshape the global marine insurance market.
References
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International Union of Marine Insurance (IUMI). (2024). Global Marine Insurance Report.
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Lloyd’s List. (2024). Hull and Cargo Insurance Market Trends.
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Clarksons Research. (2024). Offshore Energy and Marine Risk Outlook.
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Safety at Sea. (2024). Fire Risks and Shipping Safety Reports.