Marine Cargo Insurance Market Set to Secure Valuation of USD 34.0 Billion By 2032 | Astute Analytica

The marine cargo insurance market is driven by rising global trade, increased cargo theft, and stricter regulations. Insurers leverage advanced analytics and IoT for better risk assessment, while the demand for comprehensive, sustainable policies grows, requiring innovative and adaptable solutions to meet evolving industry challenges.

New Delhi, May 30, 2024 (GLOBE NEWSWIRE) — The global marine cargo insurance market is anticipated to soar to US$ 34.0 billion by 2032 from US$ 20.8 billion in 2023 at a CAGR of 5.86% during 2024-2032.

Marine cargo loss, theft, and global trade dynamics continue to pose significant challenges in 2024. Notably, global cargo theft incidents have surged by 10% from 2022 to 2024, with the average loss value per incident reaching $300,000 in 2023. Food and beverages remain the most targeted commodities, and in the first quarter of 2024 alone, 180 cargo theft events were recorded in the U.S. and Canada. Despite efforts to combat theft, less than 25% of stolen cargo is ever recovered, according to recent FBI data. All these factors adding fuel to the growth of the global marine cargo insurance market.

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Key Dynamics Behind Rapid Surge in Marine Cargo Insurance Demand

Maritime transport, a backbone of global trade, is responsible for 28% of total global NOx emissions and 3.1% of total greenhouse gas emissions. Nearly 90% of global trade is carried by the international shipping industry, with transport costs making up approximately 10-12% of total trade costs. Production and trade imbalances continue to affect physical cargo flows and transport rates, highlighting the critical role of efficient maritime logistics. Cargo loss and damage remain prevalent, with theft occurring along the supply chain, especially at distribution centers. Pilferage remains a significant type of theft, particularly in high-density areas. The rise in online shopping has led to a 15% increase in theft incidents since 2022. In 2023, 1,950 supply chain theft events were recorded in the U.S. and Canada, marking a 10% increase over the previous year.

The perception of cargo theft as a low-risk, high-reward crime persists, with many incidents going unpunished. International crime syndicates are often behind large-scale theft operations, driven by the global economic situation and increased demand for black-market goods. In order to secure from such incidents most of consumers are buying cargo insurance and giving a boost to the marine cargo insurance market. Containerized cargo flows remain imbalanced, necessitating the repositioning of empty containers. Nautical accessibility, charter party terms, and freight rates continue to influence maritime transportation, with shipping alliances now accounting for 90% of the market share on the Asia-North European trade lane.

The TT Club and BSI’s 2023 report indicates a 12% increase in cargo theft incidents. Rebeca Grynspan continues to lead UNCTAD, focusing on trade facilitation. Meanwhile, the global shipping industry must address significant air emissions impacting coastal areas and health. Decarbonizing maritime transport remains a challenge, with goals set for zero CO2 emissions by 2050. Accurate tracking of theft statistics is difficult due to underreporting, but data from Sedgwick and CargoNet highlight ongoing trends.

Key Findings in Global Marine Cargo Insurance Market

Market Forecast (2032) US$ 34.0 billion
CAGR 5.86%
Largest Region (2023) Europe (36.8%)
By Type Open Marine Insurance (22.7%)
By Coverage Natural Calamities (32.7%)
By Duration Single Transit Insurance (68.4%)
By Enterprise Size Large/Public Enterprises (56.0%)
By End Users Manufacturers (23.1%)
By Distribution Channel Offline (80.0%)
Top Trends
  • Increased Implementation of Data Analytics and Telematics
  • Rising Adoption of Machine Learning for Risk Assessment
  • Growth in Demand for Marine Insurance Products from Emerging Markets
Top Drivers
  • Rebound in Global Trade and Increased Cargo Volumes
  • Stringent Government Regulations and Mandatory Coverage
Top Challenges
  • Underinsurance of High-Value Cargo
  • Common Claims Due to Poor Handling, Storage, and Packing
  • Market Concerns and Instability from Political and Economic Factors

Open Marine Insurance Policies: Unpacking the Growth and Adoption in the Cargo Industry by Capturing Over 22.7% Market Share

Open marine insurance policies are becoming increasingly popular among cargo companies in 2024 due to various compelling reasons. The resurgence in global trade post-pandemic has led to a significant increase in cargo volumes, with premiums for cargo insurance reaching USD 20.5 billion, marking an 8.3% uptick from the previous year. This growth is further bolstered by the expanding marine insurance market, especially in emerging markets. Enhanced risk management is another critical factor. High-value cargo claims have revealed underinsurance issues by as much as $20 million, and physical damage to cargo remains a common problem due to poor handling, storage, and packing.

Regulatory and environmental considerations also play a significant role. The International Maritime Organization (IMO) has introduced regulations to reduce greenhouse gas emissions from shipping, prompting marine insurers to adapt their policies accordingly. Additionally, stringent government regulations and mandatory marine insurance coverage for ship and cargo owners are fostering industry growth. Technological advancements, such as data analytics, telematics, and machine learning, are enabling more accurate risk assessments, further driving market demand. Companies like Great American Insurance Group, with an A+ financial stability rating, provide confidence to cargo companies.

The market’s financial stability is evident, with the marine cargo insurance market projected to reach USD 50.5 billion by 2032. Comprehensive coverage options, including floating policies that save time and money for frequent shippers, and diverse risk coverage, make open marine insurance attractive. Furthermore, specialized programs like IUMI’s Masterclass in Cargo Insurance enhance industry expertise, supported by experienced staff with an average of 20 years in the field. Economic factors such as increased premiums from higher property and vessel values and normalized loss ratios contribute to market stability.

Risk mitigation is another key advantage, offering protection against cargo theft and financial losses from lost or damaged shipments. Despite market concerns and the potential instability from election campaigns, the marine cargo insurance market remains robust. These factors collectively underscore why open marine insurance policies are a preferred choice for cargo companies in 2024.

Manufacturing Companies Buy Marine Cargo Insurance on a Large Scale, In Fact They Contribute over 23.1% Market Revenue

Manufacturing companies often deal with high volumes and values of goods, necessitating comprehensive marine cargo insurance. With a projected 3.5% annual growth in global manufacturing output, the volume of goods transported is rising. The average value of these goods has increased by 15% over the past five years, underscoring the need for adequate coverage. Global supply chains, utilized by 75% of manufacturing companies, require extensive shipping across multiple countries, further increasing risk exposure. As a result, 90% of large manufacturing firms include marine cargo insurance in their risk management plans. Additionally, 60% of international trade contracts involving manufacturers mandate such insurance, ensuring protection against potential losses.

The frequency of shipping incidents, including accidents and piracy, has risen by 12% annually, prompting manufacturers to seek insurance. Technological advancements, such as the use of advanced analytics by 48% of manufacturers, allow for better risk assessment and tailored policies. Economic pressures, with a 5% decline in profit margins, drive manufacturers to secure insurance to mitigate potential losses. The marine cargo insurance market is expected to grow by 5.86% annually through 2024, driven by increased demand from the manufacturing sector. Uninsured losses in this sector have averaged $2 billion annually, making insurance a cost-effective solution. Supply chain disruptions have affected 40% of manufacturers in the past two years, increasing the need for coverage.

  • Emerging Manufacturing Market are Lucrative Players in Marine Cargo Insurance Market

The hard insurance market has led to a 10% annual increase in premiums, making marine cargo insurance more critical. Emerging markets, accounting for 30% of global manufacturing output, also drive demand. Investments in supply chain technology by 50% of manufacturers enhance risk management, further promoting insurance adoption. New marine cargo insurance products have seen a 20% increase in adoption among manufacturers, who view insurance as a competitive advantage, cited by 70% of them. Customer requirements, with 55% demanding proof of insurance, and the integration of ESG goals by 65% of manufacturers, also contribute to the demand. The stable financial outlook of the marine cargo insurance market, with an A+ rating, and a 15% increase in premiums due to market corrections, reinforce the necessity of insurance for manufacturers.

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Most of the Buyers Purchase Marine Cargo Insurance to Safeguard Against Natural Calamities and Their Premium Contribute Over 32.7% Revenue to Market

Natural disasters pose significant risks to marine cargo, with climate change intensifying these events. Projections indicate upper ocean stratification could increase by 30% by 2100, leading to more severe weather patterns affecting shipping routes. The economic impact is substantial, with uninsured losses averaging $2 billion annually in the manufacturing sector alone. Consequently, companies seek marine cargo insurance as a cost-effective risk management strategy. The frequency of shipping incidents, including those caused by extreme weather, has risen by 12% annually. Marine cargo insurance covers a wide range of natural calamities, including tsunamis, hurricanes, and severe storms, which can cause significant cargo damage and financial losses. For example, stormwater discharge and extreme events like tsunamis contribute to ocean pollution, affecting marine transportation and underscoring the need for insurance.

The insurance market has responded by developing tailored policies to address these specific risks. The marine cargo insurance market is projected to grow by 6% annually through 2024, driven by the rising demand for protection against natural disasters. The hard insurance market, with a 10% annual increase in premiums, further emphasizes the necessity of such coverage. Technological advancements in risk assessment and analytics have also boosted the adoption of marine cargo insurance. Approximately 48% of manufacturers now use advanced analytics to assess shipping risks and determine insurance needs. This integration allows for more accurate risk assessment and better-tailored policies, making marine cargo insurance an essential safeguard against natural calamities.

Top 7 Players Controls More than 46% Global Marine Cargo Insurance Market

Allianz, American International Group, Inc. and Aon plc are the top 3 players. Allianz SE has established itself as the leading player in the marine cargo insurance market, commanding over 8.5% of the market share. This dominance is driven by several strategic advantages and market dynamics that position Allianz at the forefront of the industry. As per Astute Analytica, Allianz’s extensive experience and technical expertise in underwriting large and complex projects provide unparalleled protection and peace of mind to its clients. The company offers comprehensive insurance solutions covering all stages of the distribution chain, including goods in transit, storage risks, global programs, and project cargo for specialist shipments. This broad coverage ensures that clients’ diverse needs are met, enhancing Allianz’s appeal in the market.

Allianz’s financial strength and stability play a crucial role in its market leadership. With a financial stability rating of A+ and operations in over 70 countries, Allianz has the capacity to handle the largest risks and provide tailored insurance solutions globally. The company’s robust financial performance, with earnings of $89.25 billion in 2023 despite 34.66% decline from 2022, further solidifies its position as a reliable and trusted insurer.

Moreover, Allianz’s strategic focus on innovation and risk management has been pivotal. The company leverages advanced data analytics, telematics, and machine learning to enhance risk assessment and management, staying ahead of industry trends and regulatory changes. This technological edge allows Allianz to offer more accurate and competitive insurance products, attracting a larger client base. Additionally, Allianz’s commitment to addressing emerging exposures and global risk management issues through its Allianz Commercial risk consulting team demonstrates its proactive approach to client needs and market dynamics. This dedication to client service and risk mitigation reinforces Allianz’s reputation as a market leader.

Key Statistics Highlighting Allianz’s Dominance in Global Marine Cargo Insurance Market:

  • Financial Stability: Allianz has an A+ financial stability rating.
  • Global Presence: Operations in over 70 countries.
  • Asset Value: Allianz’s total assets surpass US$ 1 trillion in 2022 but was declined to $966 billion by the end of June 2023.
  • Customer Base: More than 100 million customers worldwide.
  • Brand Value: Ranked as the sixth most valuable German brand in 2023, with a brand value over uS$20.85 billion.
  • Comprehensive Coverage: Insurance solutions for all stages of the distribution chain, including goods in transit, storage risks, global programs, and project cargo.
  • Technological Edge: Utilizes advanced data analytics, telematics, and machine learning for risk assessment and management.

Global Marine Cargo Insurance Market Key Players

  • Allianz
  • American International Group, Inc.
  • Aon plc
  • Arthur J. Gallagher & Co.
  • AXA SA
  • Berkshire Hathaway Specialty Insurance
  • Chubb
  • Liberty General Insurance Ltd.
  • The Travelers Indemnity Company
  • Zurich Group
  • Other Prominent Players

Key Segmentation:

By Type

  • Time Plan
  • Voyage Plan
  • Mixed Plan
  • Port Risk Plan
  • Valued Plan
  • Floating Plan
  • Wager Plan
  • Others

By Coverage

  • Damage from Loading / Unloading
  • Fire or Explosion
  • Sinking or Stranding
  • Overturning or Derailment
  • Collision or Contact of Vessel
  • Natural calamities
  • Piracy
  • Others

By Duration

  • Single Transit Insurance
  • Annual Marine Cargo Insurance

By Enterprise Size

  • SMEs
  • Large/Public Enterprises

By End User

  • Manufacturers
  • Retailers
  • Wholesalers
  • Importers
  • Exporters
  • Logistics Providers
  • Commodity Traders
  • Customhouse Brokers
  • Freight forwarders
  • Association and Government Bodies
  • Others

By Distribution Channel

  • Online
  • Offline

By Region

  • North America
  • Europe
  • Asia Pacific
  • Middle East & Africa (MEA)
  • South America

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About Astute Analytica

Astute Analytica is a global analytics and advisory company which has built a solid reputation in a short period, thanks to the tangible outcomes we have delivered to our clients. We pride ourselves in generating unparalleled, in depth and uncannily accurate estimates and projections for our very demanding clients spread across different verticals. We have a long list of satisfied and repeat clients from a wide spectrum including technology, healthcare, chemicals, semiconductors, FMCG, and many more. These happy customers come to us from all across the Globe. They are able to make well calibrated decisions and leverage highly lucrative opportunities while surmounting the fierce challenges all because we analyze for them the complex business environment, segment wise existing and emerging possibilities, technology formations, growth estimates, and even the strategic choices available. In short, a complete package. All this is possible because we have a highly qualified, competent, and experienced team of professionals comprising of business analysts, economists, consultants, and technology experts. In our list of priorities, you-our patron-come at the top. You can be sure of best cost-effective, value-added package from us, should you decide to engage with us.

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