Rate increases dead ahead for marine insurance

Protection & indemnity rates rose an average of 15 percent at the February renewals as insurers adapted to falling revenues and lower premiums due to recessionary hits of decreasing investment income and reduced marine activity in the recession. Hull and liability underwriters are looking at rate increases of as much as 7.5 percent for attractive businesses.

However, more than adequate capacity in most classes of insurance should keep rate increases reasonable, added Steve Beslity, global CEO of Aon Marine. "Although the markets may attempt to talk up pricing simply because it seems logical to do so in the present difficult economic circumstances, the evidence suggests there is no reason to overreact at this point," he said.

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