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Survey Report

Insurance Marketplace Realities 2022 Spring Update – Marine hull and liability

Marine
N/A

April 7, 2022

The marine market remains firm, with underwriters still seeking increases on clean business, while mandating cyber and communicable disease exclusions. Marine underwriters are becoming less willing to provide excess coverage over non-marine exposures.
Rate predictions: Marine hull and liability
Trend Range
Domestic hull and machinery, good loss records Increase (purple triangle pointing up) +7.5% to +10%
Domestic hull and machinery, poor loss records Increase (purple triangle pointing up) +20% or more
London/international hull and machinery, good loss records Increase (purple triangle pointing up) +10% to +15%
London/international hull and machinery, poor loss records Increase (purple triangle pointing up) +20% or more
P&I domestic Increase (purple triangle pointing up) +10% to +15%
P&I London/international Increase (purple triangle pointing up) +10% to +15%
Domestic primary marine general liability Increase (purple triangle pointing up) +5% to +10%
Domestic excess marine liability Increase (purple triangle pointing up) +5% to +10%, greater with underlying crew and towing exposure
London marine liability Increase (purple triangle pointing up) +15% or more
USL&H mutual Neutral Increase Flat to +5%

Key takeaway

The marine market remains firm, with underwriters still seeking increases on clean business, while mandating cyber and communicable disease exclusions. Marine underwriters are becoming less willing to provide excess coverage over non-marine exposures.

Underwriting in the current environment remains demanding.

  • Due to reinsurance restrictions, all markets are mandating disease and cyber exclusions.
  • Excess underwriters are still seeking to reduce capacity, and quota share placements are the norm, though these trends are easing as most markets have stabilized.
  • Placing of excess coverage over $1 million primary placements is increasingly difficult in the face of reduced carrier appetite.
  • Marine bumbershoot underwriters have in the past written policies with underlying non-marine liability exposures, such as auto and employers’ liability policies. They are becoming reluctant to do so due to adverse loss experience and the underpricing of these exposures. Marine reinsurers have also increased their scrutiny of extending coverage over non-marine risk.

P&I London/international

  • For the February 2022 renewal, the International Group of P&I Clubs asked for minimum general increases in the 10% to 15% range.
  • Given continuing deteriorating level of large pool claims, there is nothing to suggest that February 2023 renewal will result in any improvement, but it is of course premature to predict with accuracy.

Burdens are increasing on both sides of the negotiating table.

  • Underwriters are requiring substantially more data for renewals and new business.
  • The high number of buyers marketing their business is overwhelming underwriters, whose time to review is limited.
  • Underwriters remain under scrutiny by their senior management, who have become much more involved in the process. This negatively impacts the renewal process from the buyer’s perspective.

Disclaimer

Willis Towers Watson hopes you found the general information provided in this publication informative and helpful. The information contained herein is not intended to constitute legal or other professional advice and should not be relied upon in lieu of consultation with your own legal advisors. In the event you would like more information regarding your insurance coverage, please do not hesitate to reach out to us. In North America, Willis Towers Watson offers insurance products through licensed entities, including Willis Towers Watson Northeast, Inc. (in the United States) and Willis Canada Inc. (in Canada).

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Contact

Phil Gran
Shipowners Leader, North America

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