Escalating geopolitical tensions have had a bearing on the marine insurance market
NorthStandard managing directors Paul Jennings (left) and Jeremy Grose(Image: GRAHAM FLACK)
Shipping insurer NorthStandard has revealedf a year of “intense challenges” amid a significant expected rise in its premium income. The Tyneside-based mutual, which is among the world’s largest of its type, says premium income could rise by more than 5% to $930m (£689.3m) in the year to February 20.
It comes as global geopolitical tension has escalating further in the last year, creating a higher risk environment for insurers. Sanctions, tariffs and attacks on vessels have presented challenges.
NorthStandard, which employs about 300 people on Tyneside, has maintained the size of its poolable tonnage – the volume of ships it insurers – at 270million gross tonnes. It said the flat number came after a renewal that focussed on rebalancing its global risk portfolio.
Meanwhile, free reserves are projected to pass $900m (£667m), up from $800m (£593m) in February last year and well above the S&P Global requirements to keep its AAA capital status.
Paul Jennings, managing director of NorthStandard, said: “We are grateful for our members’ continued support and loyalty. Strong Member retention and commitment during renewal reflects the value and importance they place on the high levels of expert service NorthStandard teams deliver daily around the world.”
Bosses said that diversification efforts had helped boost results, pointing to the group’s Coastal & Inland-Sunderland Marine joint product for hull and protection and indemnity which is said to have been popular. NorthStandard has traditionally provided insurance for the operators of large, ocean going vessels involved in global trade, but more recently it has also eyed opportunities in the renewables sector – including via a partnership with NIORD/Norwegian Hull Club.
And in autumn last year, North Standard began recruitment of a new Upstream Energy and Marine & Energy Liabilities team. Jeremy Grose, managing director of NorthStandard, said further diversification will also drive premium growth next year, as ‘churn’ from newbuilds replacing older vessels could stymie premium growth.
He added: “Diversification, leaner operations, sound investments and consolidation have created the critical mass to open new offices and overhaul our digital services. We have also expanded our risk management tools, introduced a range of AI-led initiatives across our business, and broadened the scope of our loss prevention products for the direct benefit of our members.”
Elsewhere, NorthStandard said it had been focussed on driving maritime decarbonisation through its team of in-house experts offering guidance on alternative fuel options. That has included some of its members signing up to the BetterSea digital fuel pooling marketplace and supporting others with access to fuel performance analytics tools. The organisation is also a founding member of the Martime Nuclear consortium that launched only last month and focuses on the development of safe and efficient nuclear-powered vessels.
Looking ahead, Mr Jennings added: “Our focus is to support Members with the stability, strength, and innovation NorthStandard is known for. This year’s results prove our strategy is working and we intend to keep leading our industry forward.”