That may be what happens here as well, should the insurers step wrong..
And of course every hedge fund simply had to have a reinsurance operation, pumping so much capital and capacity into the niche that underwriting profits disappeared.
A deep dive from Offshore Energy, September 17:
Marine underwriting premiums for 2019 recorded a reduction of 0.9% year over year and were estimated at $28.7 billion, the International Union of Marine Insurance (IUMI) said.
As informed, 2019 saw Europe’s global share reduce slightly from 46.4% (2018) to 46.3% and Asia’s share increase modestly from 30.7% (2018) to 31.8%.
For global marine premium by line of business, cargo continued to represent the largest share with 57.5% in 2019, hull 24.1%, offshore energy 11.7% and marine liability 6.8%.
“The numbers we are reporting today (15 September) cover the 2019 underwriting year and are pre-COVID-19. In the past, we’ve been able to analyse trends to get an understanding of potential future outcomes but COVID is such a significant global event that it will inevitably impact on all statistics, including IUMI’s,” Philip Graham, Chair of IUMI’s Facts & Figures Committee, explained.
“Clearly there is a lag between IUMI’s reported 2019 numbers and the effect that COVID is having on the marine insurance markets. The loss ratio figures as of 2019 suggest the start of a modest recovery in the hull and cargo segments and a continued fragile balance in the energy segment, but it is still early days and it remains to be seen how far COVID-19 will impact these trends going forward.”....MUCH MORE
According to Graham, due to COVID-19, there has been lower utilisation of certain vessel classes such as containerships, cruise ships and yachts. A direct result is the abnormally low level of claims incidents recorded in recent months.
“While this is good for underwriters in the short-term, we should be wary of a return to normality as utilisation begins to increase.”....
