TelestackGeneva DryBühler GmbHPort of South LouisianaVan AalstPort of Stockton
  • Port of South Louisiana
  • Van Aalst
  • Port of Stockton
  • Vigan
  • Cimbria
  • TMS Awards 2023

Allianz: Shipping losses at record low

Allianz: Shipping losses at record low

(Posted on 20/07/20)

Large shipping losses are at a record low having fallen by over 20% year-on-year, according to marine insurer Allianz Global Corporate & Specialty SE’s (AGCS) Safety & Shipping Review 2020. However, the coronavirus crisis could endanger the long-term safety improvements in the shipping industry for 2020 and beyond, as difficult operating conditions and a sharp economic downturn present a unique set of challenges.

“Coronavirus has struck at a difficult time for the maritime industry as it seeks to reduce its emissions, navigates issues such as climate change, political risks and piracy, and deals with ongoing problems such as fires on vessels,” says Baptiste Ossena, Global Product Leader Hull Insurance, AGCS. “Now the sector also faces the task of operating in a very different world, with the uncertain public health and economic implications of the pandemic.”

The annual AGCS study analyzes reported shipping losses over 100 gross tons (GT) and also identifies 10 challenges of the coronavirus crisis for the shipping industry which could impact safety and risk management. In 2019, 41 total losses of vessels were reported around the world, down from 53 12 months earlier. This represents an approximate 70% decline over 10 years and is a result of sustained efforts in the areas of regulation, training and technological advancement, among others. More than 950 shipping losses have been reported since the start of 2010.

The shipping industry has continued to operate through the pandemic, despite disruption at ports and to crew changes. While any reduction in sailings due to coronavirus restrictions could see loss activity fall in the interim, the report highlights 10 challenges that could heighten risks. Among these are:

  • The inability to change crews is impacting the welfare of sailors, which could lead to an increase in human error on board vessels.
  • Disruption of essential maintenance and servicing heightens the risk of machinery damage, which is already one of the major causes of insurance claims.
  • Reduced or delayed statutory surveys and port inspections could lead to unsafe practices or defective equipment being undetected.
  • Cargo damage and delay are likely as supply chains come under strain.
  • The ability to respond quickly to an emergency could also be compromised with consequences for major incidents which are dependent on external support.
  • The growing number of cruise ships and oil tankers in lay-up around the world pose significant financial exposures, due to the potential threat from extreme weather, piracy or political risks.

“Ship-owners also face additional cost pressures from a downturn in the economy and trade,” says Captain Rahul Khanna, Global Head of Marine Risk Consulting at AGCS. “We know from past downturns that crew and maintenance budgets are among the first areas that can be cut and this can impact the safe operations of vessels and machinery, potentially causing damage or breakdown, which in turn can lead to groundings or collisions. It is crucial that safety and maintenance standards are not impacted by any downturn.”

According to the report, the South China, Indochina, Indonesia and Philippines maritime region remains the top loss location with 12 vessels in 2019 and 228 vessels over the past decade – one in four of all losses. High levels of trade, busy shipping lanes, older fleets, typhoon exposure, and safety issues on some domestic ferry routes are contributing factors. However, in 2019, losses declined for the second successive year. The Gulf of Mexico (4) and the West African Coast (3) rank second and third.

Cargo ships (15) accounted for more than a third of vessels lost in the past year, while foundered (sunk/submerged) was the main cause of all total losses, accounting for three in four (31). Bad weather accounted for one in five losses.

Latest News

Diverse Algoma fleet contributes to revenue growth

(Posted on 29/02/24)

Algoma Central Corporation has reported its results for the year ended December 31, 2023. Algoma reported... Read more


Liberian Registry establishes innovation and Energy Transition Team ??

(Posted on 29/02/24)

The Liberian Registry, the world’s largest shipping registry, has furthered its commitment to... Read more


Swedish Club widens enhanced PEME programme

(Posted on 28/02/24)

It is well known that a healthy crew is a safe crew, and that the physical and mental wellbeing of seafarers... Read more


Fleet announces strategic leadership transition in its 30th year

(Posted on 22/02/24)

Fleet Management Limited (FLEET), the world’s largest third-party ship management company, has... Read more


OceanScore: Asian shipowners face hefty EU-bound emissions liabilities

(Posted on 22/02/24)

Asian shipowners with vessels sailing to and from Europe are likely to face estimated emissions liabilities... Read more


VIKAND supports V.Ships Greece with mental health training

(Posted on 22/02/24)

VIKAND, the global leader in maritime healthcare, is providing V.Ships Greece with officer training... Read more


RMI Maritime Administrator awards AiP for Anemoi Rotor Sails

(Posted on 14/02/24)

The Republic of the Marshall Islands (RMI) Maritime Administrator has awarded an Approval in Principle... Read more


Ambrey and ISS join to revolutionise maritime safety and security

(Posted on 14/02/24)

Ambrey and Inchcape Shipping Services (ISS) have announce a strategic partnership aimed at transforming... Read more


ShipMoney celebrating 10 years providing digital payment solutions

(Posted on 14/02/24)

Founded in 2013 by Stuart Ostrow, a Florida-based CPA and entrepreneur, ShipMoney set out to challenge... Read more


ClassNK launches shipping and shipbuilding e-learning courses

(Posted on 14/02/24)

ClassNK has introduced E-Learning courses offered through its training and education service, &ldquo... Read more


CimbriaTMS Awards 2023TBA GroupViganSailors Society
  • Bühler GmbH
  • Sailors Society

Subscribe to our newsletter

Keep up to date with the latest global news in bulk cargo handling and shipping