Ship insurance risks are warned to increase

According to a newly released report from Allianz Insurance Group, despite the positive long-term outlook, the marine insurance industry is facing increased risks due to geopolitical issues, rising fuel prices. , congestion on the harbor, ….

This study is carried out annually by the German insurance company, surveying the loss and damage to large ships with a total tonnage of over 100 tons.

Specifically, the report said that in 2021, a total of 54 large ships were damaged globally, down from 65 ships the previous year. In the early years of the 20th century, statistics put the number up to more than 200 ships per year.

Notably, the damage figure of 2021 is even more impressive when in fact there are about 130,000 large ships operating globally, much higher than the 80,000 level of 30 years ago.

“This evolution reflects efforts in the application of safety measures, improvements in technology, ship design and maritime regulations,” the report said.

Collectively, over the past decade, there have been a total of nearly 900 incidents of large ships. South China, Indochina, Indonesia and the Philippines are the global hot spots in this regard, accounting for a fifth of 2021 losses and a quarter of the past decade. This is because this is an area with high trade density, frequent port congestion, an older fleet and inclement weather.

Although the total number of shipping incidents tends to decrease, the number of incidents with heavy damage tends to increase. In which, the cause of machine failure accounts for more than a third of incidents globally, followed by collisions and fires.

According to Allianz, the bans on Russian oil have contributed to higher fuel costs, and may force ship owners to use alternative fuels.

“Substantial substandard alternative fuels could lead to an increase in claims related to machinery breakdowns in the future,” the Allianz experts said.

In addition, in the current context, the authorities continue to warn about security risks such as GPS jamming, automatic identification system being tampered with or breaking into the system.

Another concern reported is the problem of rescue and rescue of ships. In the past, a shipwreck could have been left in place had it not been a danger to navigation. Now, however, authorities want the wreck to be removed and the marine environment restored, whatever the cost.

This causes the costs of shipping lines to increase, while ship insurance companies may have to increase their compensation costs to ensure environmental responsibilities.

The Covid-19 pandemic in the past 2 years has partly reduced the number of direct claims, but also increased port congestion when many safety measures were instituted.

Along with that is the negative effect on the crew. The analysis shows that with low crew morale, while commercial pressures and workloads are increasing, 75% of the causes of incidents are related to people.

Cargo fire is also a big risk mentioned. The report notes that there have been more than 70 container ship fires recorded in the past five years alone. This is also one of the main causes of heavy losses for carriers.

In addition, experts also warn about the situation of transporting containers by non-specialized vessels. These are ships that are not designed to carry containers, and will not be able to guarantee the safety of the train and its crew, especially in bad weather conditions.

Le Huy (according to Splash 247)