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Survey Report

Insurance Marketplace Realities 2021 – Marine (hull liability and cargo)


November 18, 2020

Conditions remain hard for cargo. For hull, 2020 was one of the hardest marine markets in more than 20 years.

Rate predictions

Rate predictions: Marine (hull liability and cargo)

Trend Range
Transit only
Good loss experience
Increase (Purple triangle pointing up) +10% to + 15%
Marginal to poor loss experience
Increase (Purple triangle pointing up) +15% to +20% and higher
Stock throughputs
Good loss experience
Increase (Purple triangle pointing up) +15% to + 25%
Marginal to poor loss experience
Increase (Purple triangle pointing up) +25% to +40% and higher
Hull and machinery
Good loss experience
Increase (Purple triangle pointing up) +10% to +15%
Marginal to poor loss experience
Increase (Purple triangle pointing up) +20% to +30%
Marine general liabilities
Increase (Purple triangle pointing up) +5% to +10%
Neutral Increase (Purple triangle pointing up) Flat to +10%
Neutral Increase (Purple triangle pointing up) Flat to +5%

Key takeaway

In cargo, market fluctuation around pricing is starting to subside, although conditions remain hard; market capacity continues to shrink, and quota share placements have become much more prevalent. In hull, 2020 was one of the hardest marine markets in more than 20 years, and there are absolutely no signs that market conditions for the buyer will improve in 2021.


Starting renewals early continues to be critical, especially for stock throughput programs and higher risk industries.

  • Detailed renewal data is also critical and is impacting terms, conditions and price.

In conjunction with increased rates, markets are also seeking higher retentions.

  • Rate increases vary with loss experience. Retention levels are being assessed on a case-by-case basis.
  • Accounts with catastrophe-exposed storage risks just in certain industries, segments are seeing higher rate increases. Retention levels on this business are usually going up as well.
  • Accounts with poor loss history may see significant rate increases in addition to severe retention increases, and in certain instances they may see more restrictive coverage terms.
  • When marketing profitable business, however, we are still securing competitive terms, but virtually no buyers are seeing reductions in price unless they had a multi-year deal in place, and the loss experience remains good.
  • Capacity is shrinking and is being more carefully deployed.
  • Excess stock capacity in the U.S. market has all but dried up.
  • Quota sharing risks in many instances has become necessary, especially for catastrophe-exposed storage risks.
  • Terms and conditions for industry segments, such as pharma/life science, food/beverage, automobiles and stock throughputs with retail store exposures, are being reviewed carefully. Increasingly there is a lack of market interest for large retail store risks.
  • Insurers are revisiting their underwriting strategy, risk appetite and underwriting guidelines as they look to return to profitable underwriting.
  • Detailed underwriting information is critical.

Broad manuscript policy terms are still achievable, but underwriting will focus on several factors:

  • Catastrophic risk for goods in storage
  • Broad wording for spoilage, deterioration and decay
  • Broad control of damaged goods cover, including fear of loss
  • Coverage for voyage frustration
  • Strikes, riots and civil commotions (SR & CC), with greater focus from insurers on storage coverage
  • Per location versus per occurrence limits on stock throughputs are being reviewed in conjunction with modeling
  • Policy deductible clauses
  • Catastrophic peril definitions
  • Packing for high-tech machinery and equipment, as well as pharmaceutical and life science products
  • Security on high theft-risk commodities, such as apparel and accessories, food and beverage commodities and pharmaceuticals
  • Review of logistics contract wording
  • Coronavirus and possible effects on policy terms

Insurance buyers should be ready for change.

  • Most markets have adopted cyber exclusions on marine policies.
  • The impact of COVID-19 and the economic slowdown are still TBD.
  • Analytics are playing an important role in setting terms, conditions and pricing in this changing environment. Useful tools include diagnostics for catastrophic modeling, loss trend analysis, deductible studies, heat mapping and total cost of risk (TCOR) exercises.


Marine underwriters are typically working together so unless new capacity emerges globally — which seems unlikely — conditions will continue to be very challenging.

  • Exclusions to cover are being routinely introduced in the global markets — not unlike the cyber exclusions of the last few years. This presents serious concerns to vessel owners not in P&I Clubs, as current commercial market liability covers will respond for legal liabilities to crews and passengers for illness and death. Extra vigilance in negotiation is required.
  • All marine underwriters continue to work remotely. The loss of personal contact and time to more closely scrutinize submissions has resulted in underwriters becoming more demanding in terms of cover and pricing.
  • Underwriters are reducing capacity in excess marine liability layers. There is no major claim activity to support this yet, but we suggest making general efforts to reduce risk while COVID-19 remains active.


Willis Towers Watson hopes you found the general information provided in this publication informative and helpful. The information contained herein is not intended to constitute legal or other professional advice and should not be relied upon in lieu of consultation with your own legal advisors. In the event you would like more information regarding your insurance coverage, please do not hesitate to reach out to us. In North America, Willis Towers Watson offers insurance products through licensed subsidiaries of Willis North America Inc., including Willis Towers Watson Northeast Inc. (in the United States) and Willis Canada, Inc.


Marine Practice Leader, North America

David Ripton
Global Head of Broking Marine

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