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Cargo continued to dominate global marine insurance premiums accounting for $22.64 billion in 2024
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Premiums were largely driven by global trade activity as well as movements in asset and commodity prices
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The global marine insurance premium base for 2024 was reported at $39.92 billion
Cargo continued to dominate global marine insurance premiums accounting for $22.64 billion in 2024, a rise of 1.6% from last year.
This is among the latest findings of the International Union of Marine Insurance (IUMI), which recently presented its analysis of the latest marine insurance market trends at its annual conference in Singapore.
Premiums were largely driven by global trade activity as well as movements in asset and commodity prices.
The oil price in particular plays a dual role: “It is both a key product and a major source of revenue, influencing both cargo and offshore energy insurance,” according to the IUMI analysis.
The global marine insurance premium base for 2024 was reported as $39.92 billion, representing a 1.5% increase compared to the previous year.
“We’ve seen premium income in Asia grow steadily since 2016, supported by new product lines and increasing intra-Asia trade. By contrast, Europe and Latin America appear to have plateaued since 2023,” said IUMI Chief Analyst Veith Huesmann.
“Changes in premium income tend to stem from a rise in global trade (for cargo) coupled with increases in vessel values (for hull) or an uptick in the oil price encouraging more activity in the offshore energy sector, although this hasn’t been the case in 2024,” he added.
Cargo premiums remain heavily influenced by the Chinese market which is being driven by e-commerce and return-insurance schemes. Europe (37.68%), traditionally the leading cargo market, is now experiencing a slight decline, while Asia/Pacific (35.15%) continues to rise. As a result, the gap between the two markets is narrowing, according to the IUMI analysis.
Loss ratios for cargo have been improving steadily since 2018 which is encouraging new capacity into the market. In 2023 and 2024, Europe reported very low loss ratios, while Latin America remained at an average of 40–50%.
In the US, a small number of companies reported poor results, averaging at around 50%–60%.
“The claims environment…continues to be relatively benign and this has translated into a good performance – in terms of loss ratios – for the hull and cargo business lines. However, the perennial challenges of ever-larger vessels, net-zero, mis-declared cargoes, accumulations, vessel fires and high-risk zones remain,” said Huesmann.
Global income was split by region: Europe 46.96%, Asia/Pacific 29.79%, Latin America 10.19%, North America 7.75%, Middle East 3.53%, Africa 1.38%.
By line of business, the largest share was commanded by transport/cargo at 57.23% followed by global hull 23.51%, offshore energy 11.71% and marine liability 7.55%.
The ocean hull sector reported global premiums of $9.67 billion representing a 3.5% increase from the previous year. The dominance of the European hull market (52.91%) over other regions remains significant and the gap between Europe and Asia continues to widen.
Several European countries reported substantial premium growth in 2024 partly strongly influenced by swinging exchange rates: Turkey recorded an increase of more than 30%, the Nordics reported a stable 5% rise and Russia announced growth of 15% as a consequence of imposed sanctions.
In Asia, China reported 9% growth in hull premiums. However, the overall trend for Asia over the past year has flattened, with Chinese performance partly compensating for weaker results in other Asian markets such as India, Singapore and Japan. This can be explained by the fact that many new ships delivered from China are typically insured locally.
New capacity in the hull market is also having an impact, not only for the core product but also for auxiliary covers such as loss of hire.
Geopolitical tensions, which force re-routing of global trade, are temporarily relieving supply-side constraints.
The aging of the global fleet presents additional challenges, said the IUMI analysis.
Delayed scrapping leads to older tonnage remaining in service which, in turn, raises the frequency of machinery claims. Fires on car carriers and container vessels also continue to be a major issue for hull and cargo insurers.
Emerging factors such as the introduction of alternative fuels, new technologies such as 3D-printed spare parts present fresh underwriting challenges.
Growing inflation of costs further contributes to higher probabilities of constructive total losses.
Global premiums in the offshore energy market were reported as $4.34 billion in 2024, a 7.9% reduction from 2023. The UK market continued to dominate with a global premium share of 67.33%.
This market continues to suffer from a prolonged soft cycle, now in its fifth to sixth year. The decline in 2024 European premium figures is mainly due to non-renewals and reduced new business in the UK, volumes reported by markets such as Japan, Malaysia and Egypt show a stable to downward trend. The Nordic market shows resilience and reports a 27% increase while Nigeria stands out with a 40% decline due to removal of petrol subsidies, liberalization of the foreign exchange market and change of fixed to floating exchange rates by the Central Bank.
While 2024 saw no major claims, attritional losses remain the main concern. Oil prices are showing signs of stabilizing at around $60–$70 per barrel as OPEC+ begins to unwind its voluntary production cuts of 2.2million barrels/day in six instead of 18 months.
“The marine insurance sector is relatively stable but faces some strong headwinds, with geopolitical and trade tensions creating an unprecedented level of uncertainty across global trade,” said Jun Lin, Chair of the IUMI Facts & Figures Committee.
While growth in seaborne trade has slowed — partly due to tariffs and a normalization following the extraordinary demand surge in 2024 — it is encouraging to see growth in cleaner fuel volumes outpacing those of fossil fuels.
Whilst tariffs are having an impact, put in context, they are currently affecting less than 4% of global trade.
Interest rates globally have already started to fall and the consequent reduction in inflation will likely impact overall profitability for most insurers.
Similarly, the weakening US dollar will squeeze top line premium income and add to claims costs for those insurers paying out in non-US dollar currencies.
Finally, an ageing global fleet presents growing challenges, from machinery failures to increased maintenance demands and seafarer well-being. Claims were relatively benign in 2023 and 2024 but this year has seen an uptick particularly in groundings, large vessel fires and war-related losses.
The relatively weak oil price continues to impact offshore energy prices and, consequently, insurance premiums.
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