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Survey Report

Insurance Marketplace Realities 2024 – Marine hull and liability

November 9, 2023

The marine market remains firm with demand for price adjustments across the board and higher end of range for challenging risk exposures.
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Rate predictions: Marine hull and liability
Trend Range
Domestic hull and machinery Increase, (Purple arrows pointing up) +2.5% to +5%
London/international hull and machinery Increase, (Purple arrows pointing up) +2.5% to +5%
P&I domestic Increase, (Purple arrows pointing up) +5% to +7.5%
P&I crew/towing domestic Increase, (Purple arrows pointing up) +7.5% to +10%
P&I international Increase, (Purple arrows pointing up) +5% to +7.5%
Domestic primary marine liability Increase, (Purple arrows pointing up) +5% to +7.5%
Domestic excess marine liability Increase, (Purple arrows pointing up) +7.5% to +10%, greater for underlying crew/towing exposure – first layer
London marine liability Increase, (Purple arrows pointing up) +10% to +15% or more
Domestic L&H mutual Neutral Increase, (Flat line, purple arrows pointing up) Flat to +2.5%

Underwriting in the current environment remains demanding.

  • Marine underwriters requiring premium increases for claim inflation (personal injury and increases in raw material cost) and cost of reinsurance increasing.
  • Excess liability underwriters are taking a careful review of non-marine underlying coverages (specifically auto liability) scheduled under marine bumbershoot policies and requiring higher minimum attachments points (no longer accepting $1 million underlying auto limit for fleets of significant size).
  • Excess liability underwriters reducing capacity and requiring ventilation between layers requiring quota share placements and additional market capacity.
  • Due to political unrest globally and specifically for the situation in Ukraine/Russia, we expect significant adverse developments in the hull war market in carrier capacity, appetite, and terms/conditions.
  • Underwriters seeking additional retentions on U.S. Gulf area must consider hull risks due to consistent NATCAT losses.

International group P&I clubs

  • P&I club market is starting to stabilize after several consecutive years of large pool claims, high average market combined ratio and lower investment returns.

Burdens are increasing on both sides of the negotiating table.

  • Underwriters are requiring substantially more data for renewals and new business, including loss control engagements.
  • Underwriters remain under scrutiny to deliver profits despite fewer investment returns and an increase in claim costs in the current environment, which is negatively impacted 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).

Each applicable policy of insurance must be reviewed to determine the extent, if any, of coverage for losses relating to the Ukraine crisis. Coverage may vary depending on the jurisdiction and circumstances. For global client programs it is critical to consider all local operations and how policies may or may not include coverage relating to the Ukraine crisis. 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 and/or other professional advisors. Some of the information in this publication may be compiled by third-party sources we consider reliable; however, we do not guarantee and are not responsible for the accuracy of such information. We assume no duty in contract, tort or otherwise in connection with this publication and expressly disclaim, to the fullest extent permitted by law, any liability in connection with this publication. Willis Towers Watson offers insurance-related services through its appropriately licensed entities in each jurisdiction in which it operates. The Ukraine crisis is a rapidly evolving situation and changes are occurring frequently. Willis Towers Watson does not undertake to update the information included herein after the date of publication. Accordingly, readers should be aware that certain content may have changed since the date of this publication. Please reach out to the author or your Willis Towers Watson contact for more information.

Contact

Phil Gran
Shipowners Leader, North America

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