IUMI reports an increase in the 2021 cargo insurance premium base from 2020 of 8% to USD 18.9 billion alongside an improvement in overall loss ratios.
ccording to Isabelle Therrien, Chairperson of the IUMI Cargo Committee, “the cargo market has shown growth in 2021 partly due to a rise in the volume of cargo shipped globally combined with the pricing corrective measure still prevalent in that underwriting year. The much-needed correction has yielded favourable underwriting performance.”
However, she added that the industry is still facing headwinds as the global supply chain remains volatile and is still dealing with the aftershock of the pandemic while now adding inflationary pressures to the mix.
Cargo premiums increased in most markets, with China leading the growth in 2021. China now accounts for 14% of the cargo market, with the UK having a 12.2% market share. With 2021 claims starting at a low level due to subdued activity in 2020, loss ratios continue to improve in all markets.
Ms. Therrien noted that companies are redesigning and diversifying their supply chains with concepts such as near-shoring, reshoring and friendly-shoring gaining in traction. These developments have the potential to change risk profiles in cargo insurers’ portfolios.
The pandemic has shown that factors such as stability and reliability when it comes to supply chains, are key to product availability. Our assureds are now also looking at different logistics, transportation and insurance solutions to manage this constantly evolving risk
Isabelle Therrien added.
Recently, IUMI presented its analysis of the 2021 marine insurance market trends, showing that global marine insurance premiums were up 6.4% on 2020, rising to USD 33 bn in 2021.
Lifted by a combination of increased global trade volumes, a stronger US dollar, increased offshore activity and higher vessel values, premiums for cargo, hull, offshore energy and marine liability rose in 2021. Insurers in Europe and Asia in particular saw premium growth.