Nordic Insurers: Fewer Losses, Higher Risks

The Nordic Association of Marine Insurers (Cefor) has published new marine hull claims data for the first half of 2016 indicating a continued drop in insured values in particular for bulkers and offshore/supply vessels and a downward trend in claims frequency.

There were two losses exceeding $10 million reported by June 30, compared to five such losses in the first six months of 2015. No losses exceeding $30 million were reported by June 30. 

However, larger and more advanced newbuildings increase the number of high-value vessels in the portfolio. This increases the probability of very costly total losses, which greatly impact the cost of claims, says Cefor.

The average cost of fire/explosion claims has been high in recent years, even when taking into account the typical volatility of this type of claims. The impact of these claims is moderate in the first half year of 2016.

The average cost of machinery claims showed a peak in 2013, which was mainly due to the impact of two extraordinary major claims. The cost has since come back to average levels.

The cost of nautical-related claims (collision, contact, grounding) showed a small increase in 2015, but in 2016 it is about average for recent years – with the exception of 2012 when nautical-related costs passed new heights with the grounding of Costa Concordia.

The Nordic Marine Insurance Statistics (NoMIS) database reflects 25 percent of the world fleet and 42 percent of vessels above 10,000 gross ton.

The report is available here.