The global ocean hull insurance market is continuing to soften despite growth in the overall premium base, according to Ilias P. Tsakiris, Chair of the Ocean Hull Committee at the International Union of Marine Insurance (IUMI) annual conference in Rotterdam.
The global hull premium base reached USD 10.5 billion in 2025, representing a 9.4% increase compared with the previous year. However, Tsakiris cautioned that the headline growth figure does not provide a complete picture of market conditions.
“A 9.4% increase in premium income needs to be viewed in context. Fleet growth, elevated vessel values and exchange-rate movements all contribute to that increase. Headline premium growth should not be mistaken for stronger rates or improved underwriting profitability. Despite the increase in premium income, the underlying hull market continues to soften.”
Premium growth across major regional markets has remained relatively consistent, with Europe and Asia recording increases of approximately 6-7%. Latin America performed more strongly, although it continues to account for a considerably smaller share of the global hull market.
Global fleet growth is also continuing, although at a slower pace than in previous years. Fleet growth is expected to reach approximately 3% by the end of 2026.
At the same time, subdued vessel scrapping is contributing to an ageing global merchant fleet. The average age of a merchant vessel has reached 22.4 years, creating additional pressure for hull underwriters.
Older vessels generally require more frequent maintenance and repairs, while shortages of spare parts, particularly for older tonnage, are contributing to higher claims costs. Increased Port State Control activity in several regions is also adding pressure, potentially resulting in greater inspection, detention and repair exposure.
Reported loss ratios remain relatively favourable in several major markets, although the figures are calculated using different accounting bases. Europe’s 2025 estimate stands at approximately 60% on an incurred basis, including an allowance for claims not yet reported, while Asia’s figure of around 50% reflects paid claims. Latin America recorded a lower paid loss ratio, influenced partly by premium-reporting effects, while the US reported approximately 50% for 2025.
Recent years remain subject to claims development, meaning the figures should not be treated as directly comparable measures of underwriting profitability.
Beyond the core market indicators, Tsakiris highlighted the continuing impact of geopolitical developments on global shipping patterns.
“The impact of tariffs has been less severe than we had originally anticipated, which is positive, and thankfully this has not affected our market materially. However, areas of tension and conflict, particularly in the Middle East, have forced many vessels to re-route. Although we are yet to see any meaningful rise in weather-related claims, this represents an additional risk of which we must remain conscious. We are also seeing a resurgence of piracy activity, which must be taken seriously.”
Tsakiris also highlighted the changing relationship between hull and war risk insurance. Historically, hull business has, in some portfolios, been partially cross-subsidised by war premiums. However, that model is becoming increasingly difficult to sustain as war-related losses rise.
The development is adding pressure to an already competitive hull market, with insurers having to balance premium adequacy against a broader and increasingly complex risk landscape.
Tsakiris concluded:
“Our market is characterised by a growing fleet, elevated vessel values, a changing geopolitical landscape and the potential for significant attritional losses. Whilst we are seeing growth in global premium, the underlying story is one of a softening market combined with a wider portfolio of risk.”
