Yes, I’m slowly working through my reading pile, as I recover from a rather nutty week at work.
Part of my current job involves working with some ocean marine business. So, it was with some interest I noticed an article in Business Insurance which reported on a frequency discussion at a recent global conference.
The International Union of Marine Insurance discussed the recent rise in total looses at its Winter meeting held at Lloyd’s of London, Tuesday. “We have seen an escalation in claims, both partial and large losses,” said Deirdre Littlefield, IUMI president and director of business development at Starr Marine Agency Inc., part of C.V. Starr & Co., Inc. in New York.
There has also been an escalation in global trade, and yet insurers’ premiums remain flat compared with the increase in exposures, Ms. Littlefield added.
Simon Beale, member of IUMI’s executive committee and marine underwriter at London-based Amlin P.L.C., noted that total and partial losses for vessels above 500 gross tons had accelerated in the past few years.[...]
None of that’s terribly surprising. Throw in how the markets are softening, and the outlook looks sufficient to give anyone indigestion. However, one other comment seemed particularly interesting:
Another trend that may cause concern for marine insurers was the increase in vessels built in Chinese shipyards. Construction activity last year rose from 22% of the world’s construction to 28%, a substantial move at the expense of European and Japanese shipyards, Mr. Beale said. “[Marine insurers] need to understand this. On the surface there appears that there may be a quality problem… this could be an issue for total losses in years to come,” he added.
Hunh. The folks over at CSSC have got to be feelin’ the love.
