The marine insurance market is seeing underwriters and insurers take a more cautious approach to risk as they push for increases.
Stephen Rudman, marine practice leader at Arthur J.
Gallagher, said that the local market remains competitive, with underwriters still keen on new business but taking a slightly more cautious approach.
“The current state of the market as we see it is still very competitive, however we are starting to see a lot of underwriters take a more conservative approach with renewals and new business opportunities,” Rudman told Insurance Business. “They seem to be tightening their belts a little bit and pushing for some more increases.”
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Rudman noted that the key London market has seen a series of interesting results from a marine and transport perspective, with many underwriters and syndicates seeing low profit margins or losses in the sector.
As underwriters move exercising greater caution, Rudman noted that brokers need to become more aware of the whole offering of their clients.
Supply chain risk is seen as one of the biggest risks facing the marine and logistic industries, with high profile claims events such as the Tianjin explosion in 2015 highlighting the importance of supply chain risk management.
Logistics and marine firms traditionally operate off low margins and have pushed further into the contractor route for back-end services. As firms in the industry look to become a one-stop-shop for their clients, more risks emerge.
“There are a lot of contracts in place, a lot of entities in place, even though the front customer doesn’t see that. So, you need a broker there that really understands contracts, the supply chain and how it all works because when there is a big claim, it becomes legal and that is where you need that contract certainty and a specialist broker,” Rudman concluded.
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