IUMI Annual Conference: New trade routes, rising war risks and AI reshape marine insurance outlook

September 22 ------ The global marine insurance market remains broadly stable, but underlying premium growth is being supported by a weaker US dollar, masking what remains a predominantly soft market, according to IUMI President Frédéric Denèfle.

Opening the International Union of Marine Insurance (IUMI) Annual Conference in Rotterdam (20-23 September), Denèfle said the sector was entering a period of significant change as geopolitical tensions, evolving trade routes, digitalization and the shipping industry’s transition towards lower-carbon operations reshape the risk landscape.

While the overall market continues to perform well, Denèfle warned that insurers must remain alert to the forces transforming global trade and the new risks emerging alongside them. Premium growth has been particularly influenced by currency movements, with the weaker US dollar boosting reported figures in the hull and cargo segments.

Beneath that headline growth, however, market conditions remain predominantly soft, highlighting the need for insurers to closely monitor both emerging exposures and changes in global trade patterns. “The hull and cargo markets have shown growth in terms of premium income, although the offshore energy sector remains relatively subdued,” said Denèfle. "US trade tariffs haven’t caused the disruptions we feared, and the world economy was more resilient than anticipated. But there is considerable uncertainty from increasing war risks, additional capacity bringing greater competition and continued inflationary pressure. This is coupled with ongoing uncertainty around free trade and global commerce."

Despite these challenges, Denèfle highlighted the ability of marine insurers to continue providing cover in all of the world’s higher-risk regions. He said the changing geopolitical landscape was also likely to influence the future shape of global trade and, consequently, the risks that marine insurers will be asked to cover. “As insurers, we must be prepared to insure tomorrow’s trades and trade routes, including those being introduced to avoid areas of tension and conflict,” he said. “We also need to understand the new markets that will inevitably emerge as a result of geopolitical developments.”

Denèfle further stressed that marine insurers had an important role to play in supporting the decarbonisation of shipping. "Insurers must take a leading position on the decarbonisation of shipping, despite the hiccups we have experienced so far on this journey," he noted.

AI and digitalization set to reshape marine insurance

Technology is another area where significant change is expected. The rapid development of data standards, digitalization and artificial intelligence is already beginning to influence how marine insurance operates. "I see a day, not too far in the future, when our sector will be able to offer fully digitized and standardized global cargo insurance certificates that meet the requirements of financial institutions and our customers. […] AI is going to change how we operate. It will make us smarter and more efficient, and we will need to embrace and adopt this new technology wholeheartedly," Denèfle highlighted.

While the pace of change is considerable, Denèfle said the marine insurance sector was well placed to respond. “Despite all this change, our sector remains strong, agile and ready to adapt.”

The IUMI President further highlighted the Netherlands’ longstanding contribution to IUMI, noting that the country has hosted the association’s annual conference five times in recent history and provided two IUMI presidents, Rogaar in 1962 and Kamp in 1985. He also pointed to IUMI’s continued development over the past year, including an expanded Secretariat and growing activity across advocacy, policy, education and market analysis.

Source: safety4sea.com