Insurance Marketplace Realities 2023 – Marine hull and liability
December 1, 2022
The marine market remains firm; however, underwriters are seeking smaller increases than in recent years.
Rate predictions: Marine hull and liability
Domestic hull and machinery, good loss records
+5% to +7.5%
London/international hull and machinery, good loss records
+5% to +10%
+5% to +7.5%
P&I crew domestic
+7.5% to +10%
Domestic primary marine general liability
+5% to +7.5%
Domestic excess marine liability
+5% to +10%, greater with underlying crew and towing exposure for 1st excess layer
London marine liability
+7.5% to +15% or more
Flat to +5%
Underwriting in the current environment remains demanding.
Increasing inflation, notably “social” inflation, is influencing the market, especially with respect to personal injury and increasing raw material costs.
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 unless above at least $5 million – $10 million due to adverse loss experience and the underpricing of these exposures.
International Group P&I Clubs
For the February 2022 renewal, IG P&I Clubs asked for minimum general increases in the 10 to 15% range.
Given the 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 businesses 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.
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).