Regulatory scrutiny of business ESG credentials to increase
There has been a flattening of rates in marine and cargo insurance, a shift from the rising rates of previous years, insurers are offering a more accommodating risk appetite within limits, although there has been no softening yet.
New regulations, however, such as the Energy Efficiency Existing Ship Index and the Carbon Intensity Indicator are placing pressure on business profitability due to costs to conform. The current insurance market conditions are leading marine and cargo companies to strongly focus on ESG vessel compliance, with underwriters carefully assessing risks before accepting them within the scope of the insurance cover.
In our Business Insurance Market Conditions and Risk Dynamics H2 2023 report, we provide further insights on how these factors are influencing insurance for the sector:
- Rates stabilise as insurers display a higher risk appetite.
- Enhanced regulatory scrutiny on ESG practices over the next 12 months.
- Rising sophistication of cyberattacks drive specialised cyber insurance demand.
- Geopolitical and natural catastrophe concerns are driving increased risk management awareness in businesses.
- Rapid digitisation and adoption of AI-driven automated tools are revolutionising efficiency in the industry.
Other topics covered include:
- Claims — supply shortages and significant weather events drive up claims inflation rate
- D&O — negotiable premiums provide a more favourable market for companies seeking D&O
- Cyber — risk awareness takes centre stage as breach response resilience is prioritised
- Property — increased rates and variable capacity are becoming the new norm
- Workplace risks — regulators consider tightening measures as the trend towards workers' long-term claims rises
- Energy & renewables — insurer appetite is growing in a period of transition
For more insights on the state of the business insurance market in Australia and risk dynamics, download our full report.
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