Marine seeing increased premiums across most classes (source: Lloyd’s List)

Marcus Baker does not usually attend underwriter-dominated IUMI conference, but will be glued to the screen for the Zoom event over the next fortnight

Leading broker predicts rising premium volumes for most marine lines, with the possible exception of P&I when trade association unveils figures next week, and discussing what the coronavirus backdrop is doing to the sector

 

MARINE insurance will probably have proved profitable across most main classes when 2019 statistics are released at the online International Union of Marine Insurance conference next week, the head of marine and cargo at Marsh JLT specialty has predicted.

The coronavirus backdrop and a spate of recent major casualties may well show up when the figures for 2020 are presented next year, he added, but these are not anything that the sector cannot take in its stride.

Marcus Baker has not usually attended previous IUMI conferences, which are traditionally dominated by underwriters rather than brokers.

However, he intends to watch most of the Zoom sessions over the next two weeks, along with a number of colleagues, now that the event has adopted a virtual format on account of coronavirus.

“I never used to go just to be in the same spot as underwriters when I can see them anywhere in the world,” he said. “But what they have done this year in allowing access to everybody else is debunking some myths. Having that open and transparent process is great. It is a really progressive thing they are doing, and I am all for it.”

Mr Baker paid tribute to the facts and figures material for the prior year unveiled at the annual gathering, and Marsh JLT intends to produce analysis based on the findings.

“We should see an increase in premium volume in every sector, because the market started to move in 2019. That will be a positive signal, and may well influence profitability, although that’s too early to tell.”

P&I may prove the exception to the rule, but both H&M and cargo should be up.

Recent months have seen some major casualties, including Hoegh Xiamen, Wakashio and New Diamond, which are likely to put a dent in 2020, but are not in themselves unmanageable.

In general, marine lines have weathered coronavirus better than classes such as business interruption.

“A small number of instances and claims notifications have come through, but it is hard to see how you get damage on a ship caused by coronavirus. In cargo, you may see some issues over delays in delivery, but fundamentally it has not been as big an issue as it has in event cancellation and some property lines.”

The marine sector does want to continue coverage, albeit with the terms spelled out for the sake of clarity. The bigger impact has been physical, and the market has shown itself resilient in continuing to operate.

“Trade is still taking place. People have had their insurance policies renewed. The paperwork has gone out, debiting has been done and claims are still being collected. What an incredible thing to have to go through to realise we could do all this.”

From the broking perspective, the biggest change is loss of face-to-face contact, which can now be partially resumed as restrictions ease.

“Human interaction is what we miss. It is what we have been brought up on, it is what has made us successful. To be able to do that again has been life affirming.”

Mr Baker was speaking via Zoom from his office, and discounted the much-talked-about prospect of ‘the death of the office’. Marsh JLT staff are returning to their desks in a cautious fashion, with ample provision of company-branded masks, wipes and hand gel.

“With my background as a broker, and I think my personality, I like to have the human interaction. But we are doing this in a proper and safe way, which should make people feel comfortable.”