As the International Union of Marine Insurance (IUMI) opened its annual conference in Singapore one leading underwriter has said emerging risks are increasingly transforming the hull insurance market, creating both challenges and opportunities for insurers.

Speaking in Asia Paul Western, head of Hull Underwriting and senior underwriter – War at Markel International said the market faced a range of risks creating a need for a more forward thinking approach by the industry on behalf of its clients.

“One prominent risk is cyber threats, which can compromise critical systems such as GPS, ECDIS (Electronic Chart Display and Information System) and AIS (Automatic Identification System),” he explained. “These vulnerabilities can result in a loss of situational awareness, misrouting, collisions, groundings, or even total vessel loss. As vessels become more digitised, underwriters must evaluate exposures beyond physical damage, which includes potential disruptions to supply chains resulting from delayed shipments.”

However, Western said the industry and its clients could not ignore the threats posed by the growing geopolitical risks.

“Geopolitical instability and regional conflicts – such as those impacting key shipping areas (e.g. Red Sea or Strait of Hormuz) – pose increased risks of detention, damage, or war-related losses,” he continued.  “In addition, rerouting around the Cape of Good Hope has extended voyage durations, resulting in greater operational hours for machinery and increased stress and fatigue among crew members. These factors contribute to further delays in cargo shipments arriving at ports.”

One focus at the IUMI event is the transition to a net zero future

“As the maritime industry pushes toward decarbonisation, the adoption of new alternative fuels – such as LNG, methanol, ammonia, hydrogen and biofuels – is accelerating,” explained Western. “While these fuels support global climate targets and regulatory compliance (IMO 2023, EU ETS), they also introduce a new layer of complexity for marine hull underwriters.”

He added each alternative fuel presents unique technical and operational risks:

• Ammonia and hydrogen, though carbon-free, are highly flammable or toxic, increasing the potential for onboard fires, explosions and crew safety incidents.
• Methanol, while easier to store, poses corrosion risks and demands modified fuel-handling systems.
• LNG, although more established, still requires cryogenic storage and carries the threat of gas leaks or boil-off incidents.

“For hull underwriters, these fuels represent a break from historical data patterns,” said Western. “The lack of long-term loss experience for vessels operating on these fuels makes it difficult to model risk accurately.

“This uncertainty increases exposure to claims volatility, especially when operated without specialised crew training. Additionally, engine design changes, new fuel containment systems, and onboard safety technologies create more complex asset profiles.

“Underwriters must adopt a more forward-looking, technically informed approach, leveraging collaboration with marine engineers, classification societies and shipowners.”

He concluded; “At Markel, we’re investing in building this expertise – positioning ourselves to underwrite the future of green shipping with confidence and clarity.

“Markel remains committed to supporting our clients by continuing to manage these evolving exposures and developing bespoke insurance solutions, to not only help them navigate this dynamic and volatile risk environment but also maintain our leadership position in the marine market.”