FEATURES
SECTOR FOCUS: MARINE
MARINE INSURANCE BY THE NUMBERS
$29.9 billion
Global marine insurance underwriting premiums in 2015
10.5%
Drop in premiums from 2014 to 2015
Which regions purchase the most marine insurance?
Europe 50.4% Asia Pacific 27.1% Latin America 9.8% North America 5.9% Other 6.8%
Which business lines are most popular?
Transport/cargo 53% Global hull 25% Marine liability 7% Offshore/energy 15%
Source: International Union of Marine Insurance
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Help wanted As with many segments of insurance, many leading brokers in the marine space are reaching retirement age, creating a talent void that young, ambitious brokers should step up to fill. “There are not enough brokers in the ocean marine space right now,” Barnwell says. “I was at the Council of Insurance Agents & Brokers last year, and no less than three brokerage firms said they were looking to hire marine brokers. It’s an active space, and skilled brokers are needed.” For brokers aiming to break into the space, or grow and expand their business in marine insurance, getting fully educated on the segment and becoming familiar with
owner’s main aim is to keep insurance costs to a minimum. A more lucrative area for brokers is the yacht market, where hull and P&I coverage usually ranges from total loss replacement all the way to market value. On the P&I side, most yacht policies include things like hurricane haul-out protection, full-limit wreck removal, defense costs, and search and rescue. “Generally speaking, yacht insurance offers bigger limits for standard coverages like personal effects and furniture,” says Paul Sexton, vice president of product management and development at Norman-Spencer Agency. “Most policies do a pretty good job, but some are broader than others.”
“The Coast Guard used industry feedback to develop a rule that has a lot of positive benefits for carriers and underwriters. Brokers can help with the implementation of the rule by giving feedback on where their clients stand on implementing the necessary changes” Captain Andrew Kinsey, Allianz Global Corporate & Specialty industry groups is an important first step. “If you speak the clients’ language, you are going to have much better, more comfortable discussions,” Barnwell says. “Clients in the marine segment want to work with brokers who understand their business.” As well as covering large commercial vessels, marine insurance also encompasses personal watercraft. In the small boat space, which includes anything up to 26 feet, coverage is often provided via bundled policies or endorsements on homeowner’s policies. In many cases, the small boat
The watercraft market is experiencing something of a rebound, and as a result, there is a strong demand for personal lines yacht insurance. Competition is fierce, however, and Sexton is seeing new yacht markets come into play with increasing regularity. As a result, rates are extremely soft. “It’s very competitive in the yacht world,” Sexton says. “Rates are very depressed, and that’s being driven by the everyday yacht customer shopping around more frequently because they think they can get a cheaper price elsewhere.”
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