Marine Insurers Increasingly Concerned Over Covering Mega-Containerships

The International Union of Marine Insurance said that there were worries about the huge cargo values being carried aboard mega-ships.

Marine insurers are becoming increasingly concerned over the implications of covering ever growing ultra-large container vessels (ULCVs) carrying huge cargo values, the International Union of Marine Insurance (IUMI) has said in an emailed statement. 

The organization said that there were also worries about the integrity of vessel structures and the ability of salvors to respond in case of an incident. 

“The marine insurance sector is undergoing a period of change," said IUMI President Dieter Berg.

"We are experiencing a number of external challenges due to increasingly complex technologies and the impact from the financial environment." 

In addition to mega-ships, the growth in offshore oil and gas exploration has also increased insurers' exposure to losses, said Berg, along with a growing reliance on information technology that has increased the risk of cyber attacks. 

"Added to that, uncertainty over oil prices and the general economic picture is exposing marine underwriters to a level of risk we’ve not experienced before," he added.

It was reported earlier this year that having to cover the loss of an ultra-large containership could be a "nightmare" for insurers, especially as even the loss of the half-full 8,000 TEU MOL Comfort in 2013 cost insurers $523 million. 

Earlier this month Maersk Line became the latest box carrier to order 20,000 twenty-foot equivalent unit (TEU) capacity vessels and the carrier's CEO Soren Skou earlier this year said capacities of 25,000 TEU were possible.

Ship and Bunker experts have previously speculated that the capacity size of containerships will be capped when the marine insurance industry finally balks at the potential losses.