The International Union of Marine 色多多视频 (IUMI) 2024 annual conference will be held in Berlin, Germany, where IUMI was founded in 1874. Fittingly, one of the sessions is titled, “Building on 150 years of enabling global commerce,” an apt summary of marine insurance's vital role in facilitating maritime trade and shaping the global economy. While some of the agenda for this milestone conference will reflect on the IUMI’s historical contributions, attendees will also discuss how our community can continue to support the maritime shipping industry as it confronts multiple vexing challenges.
The historical context
Marine insurance stretches back to antiquity. Shipowners and merchants in ancient Babylon and Phoenicia (circa 3000 BCE) are known to have engaged in early forms of risk sharing. Ancient Greeks (circa 800 BCE) and Romans (circa 3rd century BCE to 5th century CE) also established the concept of conditioning loans on the voyage's safe completion.
In the 12th-14th centuries, Lombard merchants in northern Italy formalized marine insurance contracts that specified coverage terms and conditions and the specific risks covered. Powerful Italian city-states, including Venice, Genoa and Pisa, quickly adopted these practices. Then, in the 13th-17th centuries, the Hanseatic League, a confederation of merchant guilds and market towns in Northwestern and Central Europe, required organized risk management on trade throughout the Baltic and North Seas. Around the same time, advances in actuarial science, along with Edward Lloyd’s keen insight into the critical importance of information and data, led to the creation of Lloyd's of London in 1688. It quickly became synonymous with marine insurance, and Lloyd’s practices and standards helped shape today’s modern insurance markets.
The need for robust marine coverages and stable insurance markets became even more pronounced in the late 19th century, a period that, in retrospect, created the foundation for today’s vastly larger and highly interconnected global economy. In particular, the introduction of faster, more reliable and efficient steam-powered ships during this era helped turbocharge international commerce.
However, as maritime trade and the global economy flourished, the frequency and severity of losses—ships sinking, cargo being damaged or stolen, warehouses catching fire—increased substantially, and individual events became more complex and costly. This unsettled risk landscape posed significant challenges to the fast-growing maritime shipping industry and to the broadening network of insurers formed to spread risk among larger groups of investors.
Addressing marine insurers’ common issues and challenges
IUMI’s establishment in 1874 marked an important turning point; its founding members recognized that by collaborating and sharing knowledge, they could better navigate the complexities of marine insurance, set industry standards, and advocate for their members' interests.
In its early years, IUMI provided a platform for discussion and information exchange, crucial in an era when communication was not as instantaneous as it is today.
The mid-20th century was another transformative period for the maritime industry, with its advances in shipping technology, changes in global trade routes, and the emergence of new maritime risks. In response, IUMI began to play a more active role in international regulatory discussions, representing the interests of marine insurers in various global forums. This was when IUMI started publishing reports and guidelines, contributing to more robust marine insurance practices.
The advent of containerization in the latter half of the 20th century revolutionized global shipping. It also introduced new challenges, including overweight containers and misdeclared cargo carrying hazardous materials. IUMI responded by conducting in-depth research and providing guidance on managing these risks. It also became more involved in environmental issues, particularly in response to high-profile oil spills and other maritime disasters.
A robust policy agenda
Fast-forward to today: IUMI’s current policy agenda underscores the difficulties marine insurers face in supporting a maritime shipping ecosystem in an increasingly volatile risk landscape, one filled with operational, geopolitical, environmental and technological hazards. Some of the most pressing issues include containers lost at sea, the urgent need to reduce carbon dioxide emissions, and the dangers of transporting products containing lithium-ion batteries. (These are among the workshop topics at the conference in Berlin.)
Lost at sea
As container ships get bigger and bigger, more containers are being lost at sea. IUMI has been extensively involved in sponsoring research on the complexities leading to containers being swept overboard. It also helped develop a Notice to Mariners, which guides crew and operational staff about planning, recognizing and acting to prevent parametric rolling in “following seas,” a significant cause of losses. IUMI also supported draft amendments to SOLAS (the International Convention for Safety of Life at Sea) requiring Masters to report lost containers promptly; these amendments are expected to go into effect on January 1, 2026.
Decarbonizing shipping
The maritime shipping industry accounts for 2-3 percent of global greenhouse gas emissions. In response to international agreements and pressure from regulators, financial institutions and the broader public, the industry is exploring myriad possibilities for reducing harmful emissions across the entire value chain. Here, too, IUMI is backing various legislative and regulatory efforts concerning, for example, safety guidelines for alternative fuels. It also actively supports The Poseidon Principles for Marine 色多多视频, a collaborative effort involving major international marine insurers, including 色多多视频 and leading shipping companies. Its primary objective is to establish a standard for quantifying and reporting the carbon intensity of marine insurance underwriting portfolios. The goal is to achieve net-zero emissions from international shipping by 2050.
Lithium-ion batteries
Now ubiquitous, lithium-ion batteries—including new and used batteries, and those installed in electronic devices—are being shipped across all modes of transport. (More and more battery-powered vessels, with either fully electric or hybrid systems, are also coming online.) The risk here is what’s called a “thermal runaway.” Certain conditions—for instance, excessive heat—can trigger internal increases in battery temperature. If the heat doesn’t dissipate, these batteries can catch fire. In addition to the fire risk, such events generate toxic gasses and residues persisting after the fire is extinguished. Thermal runaway is a relatively new risk, and the industry is still grappling with how to minimize it. For its part, IUMI is working to develop best practices for handling these cargoes. Transporting lithium-ion batteries is also the focus of an IUMI “master class” designed to familiarize marine underwriters with this risk and guide clients on safely securing these materials.
Increasingly connected risks
The security and stability provided by marine (re)insurers facilitated the development of dense international trade networks, bringing greater economic prosperity to countries and regions worldwide.
The downside is that individual events, like the ongoing attacks in the Red Sea or the Baltimore bridge accident, reveal a more highly interconnected risk landscape. Today, the impacts from such events aren’t limited to a narrow set of stakeholders but now “have the potential to create cascading exposures to marine (re)insurers.” That means (re)insurers need to undertake more sophisticated portfolio analyses to understand the interplay between, for instance, transit routes, ship movements and port accumulations, so we can help clients take proactive measures to lessen the threats.
In conclusion, the global economy, international trade and IUMI have all evolved significantly since 1874. IUMI has grown from a forum for discussion and information exchange into a worldwide leader in marine insurance, influencing industry practices and policies. As the risks —e.g., geopolitical tensions, climate change, cybersecurity, regulatory requirements, and technological innovation—multiply and add complexity, IUMI’s role has become more vital than ever. Meanwhile, IUMI’s commitment to collaboration, research, and advocacy means that marine insurance can continue to support and enable global commerce for another 150 years.
