Marine insurance market could reach $33.9B over next five years
The marine-insurance industry is expected to keep growing, thanks in part to improved safety practices.
The global marine insurance market reached $26.383 billion in 2020 and is expected to grow to $33.9 billion by 2028, Allied Market Research reports.
Should this forecast come to fruition, the market would see a compound annual growth rate of 3.1% between 2021 and 2028.
Marine insurance is key to global trade and includes lines that protect against risks related to the transport of goods by water or land.
The market experienced uncertainty in recent years thanks to geopolitical uncertainty, shifting trade patterns, new environmental regulations, climate change and the COVID-19 pandemic.
However, Allied reports that the implementation of telematics, a rise in demand and awareness toward marine insurance from ship and cargo owners, and losses from damage to ships, cargo vessels and terminals have all driven growth in the marine insurance space.
Despite anticipated market growth, a May 2024 report from Allianz showed the number of vessels lost by fleets globally decreased to a record low in 2023; declining from more than 200 vessels per year in the 1990s, to 41 in 2022, to just 26 last year. Cargo ships accounted for 60% of the lost vessels in 2023, with the main cause of total loss across all vessels being foundering (sinking).
Fire incidents were plentiful in 2023, however, with 205 reported for the year — the second highest total in a decade. Over the last five years, there were 55 total losses that resulted from fires, Allianz reports.
The number of shipping casualties fell by around 3% from 2022 to 2023, from 3,036 to 2,951, with the British Isles reporting the highest number of incidents. Globally, Allianz found machine damage or failure accounted for more than half of all shipping incidents.