Offshore energy insurance market faces growing profitability pressures, reports IUMI

The global offshore energy insurance market faced increasing profitability challenges in 2025, according to the International Union of Marine Insurance (IUMI). Michele Cibrario, Chair of IUMI’s Offshore Energy Committee, reported that global premiums reached USD 4.8 billion, only a 0.1% increase from the previous year. The London market, comprising Lloyd’s and the International Underwriting Association (IUA), held a 60% share in global premiums, remaining stable.

Despite headline growth in some regional markets, overall competition remained fierce, with capacity outpacing demand. Insurers focused on growth, but profitability pressures persisted due to rising inflation, attritional claims, and longer-term construction risks. Loss ratios remained low, but are expected to increase as claims mature.

Looking ahead, Cibrario predicted higher capital expenditure in 2026 due to energy security concerns. Many offshore sites were still recovering from geopolitical disruptions, and investment in renewables was significant. However, profitability in energy insurance remained challenging. Major investment in oil and gas, LNG, and new energy infrastructure contributed to the complexity and value of risks insurers covered.

Cibrario emphasized the challenge for energy insurers: the growth in risk complexity outweighed their ability to appropriately assess it. Sustainable growth required educated underwriting, effective accumulation management, and prudent use of reinsurance. Success depended on understanding the interconnected, long-term risks being assumed.