IUMI President: Marine insurers are war insurers

Marine insurers play a crucial role in managing war risks associated with global shipping, according to IUMI President Frédéric Denèfle. At the International Union of Marine Insurance (IUMI) conference in Rotterdam, Denefle stressed the need for marine insurers to develop tools to facilitate international trade despite challenging conditions.

He highlighted a common misconception that war insurance cover is automatically cancelled during conflicts. However, this is often not the case. When risk significantly increases, some insurers serve a Notice of Cancellation, allowing them to reassess the risk and then reinstate the cover on adjusted terms. Denefle also pointed out that underwriters require more detailed information to assess and implement war risk cover effectively, including the specific trading and transit areas, length of time in high-risk zones, and loading and discharge times.

Obtaining this information can be challenging for some cargo owners. Moreover, insurers cannot solely rely on protection measures provided by nation states, as it may not be available for every transit. Additionally, there's a risk of CNED — confiscation, expropriation, nationalisation, or dispossession, which can become significant during periods of conflict.

These risks can arise when states decide to take control or ownership of a vessel or its cargo. Denefle emphasized that cover for war risks is increasingly common, and vessel and cargo owners must understand that insurers now need more information than ever before to create tailor-made contracts that deliver adequate protection.