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Marine Cargo Insurance: Securing Global Trade and Supply Chains

Marine Cargo Insurance is the largest segment of Global Marine Insurance, representing 56.9% of it, followed by Ocean Hull (9.2%), Offshore Energy (4.6%), and Marine Liability (3%).

January 29, 2025 • Estimated Reading Time: 13 minutes

In this article

Market Overview

Marine Cargo Insurance is the largest segment of Global Marine Insurance, representing 56.9% of it, followed by Ocean Hull (9.2%), Offshore Energy (4.6%), and Marine Liability (3%). 

Marine Cargo Insurance Market was valued at an estimated value of $22.1B as of 2023, and it is expected to grow at a CAGR of ~3.4% by 2032, reaching a total market value of ~$29.9B, driven by increasing global trade activity (especially with the surge of emerging markets) and the continued growth of insurance premiums. 

This growth is further supported by rising e-commerce-driven logistics, stricter international regulations mandating cargo coverage, and advancements in risk assessment technologies enabling tailored insurance solutions for diverse industries.

Geographic Split

Regions

Europe ranks first as the top region by Marine Cargo Insurance revenue, with a 2023 total value of $8.81 billion, representing 39.8% of the global market. This dominance is primarily attributed to the presence of numerous large, well-established insurance companies headquartered in the region and Europe’s central role in global trade, bolstered by its advanced logistics infrastructure and regulatory frameworks that emphasize cargo coverage. Additionally, the region’s mature economies and high trade volumes contribute significantly to its market leadership.

Asia-Pacific follows as the second most important region in the Marine Cargo Insurance market, capturing 32.2% of global revenue with a market value of $7.13 billion. Asia-Pacific's rising influence stems from its critical role in global trade and supply chains, driven by manufacturing hubs, export-led economies, and strategic geographic positioning. Countries in the region, such as China, Japan, South Korea, and emerging Southeast Asian nations, heavily depend on foreign trade, making them key contributors to the market. The region’s rapid economic growth, urbanization, and investment in port and trade infrastructure are expected to further fuel its market share and cement its position as a growing force in Marine Cargo Insurance revenue.

Top countries

The United Kingdom, home to some of the world’s largest and most established Marine Cargo Insurance companies, leads as the top country globally in Marine Cargo Insurance revenue, accounting for 14.5% of the market. This leadership is deeply rooted in the UK's long-standing history in maritime trade and its robust financial and insurance sectors, centered in London, a global hub for marine insurance. China follows closely with 14.4% of the global market, driven by its massive export-oriented economy and dominance in global manufacturing and trade. The United States ranks third with 6.7%, leveraging its significant role in both imports and exports, as well as a sophisticated insurance industry catering to diverse cargo needs.

Other notable players include Singapore (1.7%), Belgium (2.1%), and the Netherlands (1.8%). Despite their relatively small geographic sizes, these countries rank among the top contributors to Marine Cargo Insurance revenue due to their status as critical global trade hubs. Singapore serves as a gateway for trade in Asia, with world-class ports and a reputation for efficiency in logistics. Similarly, Belgium and the Netherlands, with major ports like Antwerp and Rotterdam, play pivotal roles in European and global supply chains, underpinned by their extensive expertise and long-standing tradition in logistics and international commerce. These countries exemplify how strategic trade locations and operational excellence can translate into outsized influence in the Marine Cargo Insurance market.

  1. Port Congestion and Cargo Delays

The COVID-19 pandemic created significant port bottlenecks, with cargo accumulating due to factory closures and labor shortages. While conditions have improved, supply chain delays persist, exacerbated by truck driver shortages. Prolonged cargo resting periods increase risks such as theft, fire, and other static exposures, emphasizing the importance of comprehensive coverage for goods in transit and at rest.

  1. Warehouse Stockpiling and "Just-in-Case" Inventory

Companies have shifted from "just-in-time" to "just-in-case" inventory models to mitigate supply chain disruptions. This stockpiling strategy, combined with reduced consumer demand, has led to an overaccumulation of goods in warehouses. These static exposures are driving demand for stock throughput coverage, as insurers adapt to evolving inventory management practices.

  1. Inflation and Rising Value of Stored Inventory

Inflation has increased the aggregate value of stored inventory, intensifying risks and the need for adequate coverage. Higher valuations impact the amount of insurance capacity required per warehouse, making risk assessments and cost considerations more critical for insurers and insured parties alike.

  1. Larger Vessels and Higher Container Stacks

The push for efficiency has led to larger vessels and taller container stacks, maximizing cargo space. However, these practices introduce new risks, including higher rates of containers lost at sea, increased vulnerability to extreme weather, and challenges in combating fires on larger, densely packed ships. The frequency and severity of these incidents are rising, requiring more sophisticated insurance solutions.

  1. Mis declared or Undeclared Cargo

The global shipping industry faces risks from misdeclared or undeclared hazardous materials, estimated to affect 150,000 containers annually. These "container time bombs" pose significant safety hazards, including fires, explosions, and environmental pollution. Mismanagement during transit exacerbates these risks, highlighting the need for robust oversight and tailored marine insurance policies.

As the marine cargo landscape evolves, insurers are adapting to address these challenges by providing comprehensive coverage for goods in transit, at sea, or stored in warehouses. These trends underline the critical role of marine insurance in mitigating risks associated with modern supply chains and ensuring the resilience of global trade.

Pricing Driver: Insurance Premiums Growth

Marine Cargo Insurance premiums have been on a steady upward trajectory since 2016, contributing significantly to the growth of the Marine Cargo Insurance market value and opportunities. This trend is closely linked to the consistent expansion of global trade volumes and values, driven by factors such as rising demand for goods, increased e-commerce activity, and the globalization of supply chains.

Premium growth is further supported by the evolving risk landscape, including heightened regulatory requirements, technological advancements in risk assessment, and a greater emphasis on comprehensive cargo coverage by businesses. These dynamics not only reinforce the market’s stability but also present a compelling opportunity for insurers to innovate and capture value in a progressively interconnected global economy.

The relationship between Global Cargo Premium growth and the growth in World Trade Volumes and Trade Values (indexed to 2014 as the base year, 100%) demonstrates a clear alignment over the observed period, with all variables showing growth of similar magnitudes over time.

From 2014 to 2023, the steady increase in global cargo premiums reflects its intrinsic link to the expansion of trade activities, both in volume and value. The disruptions caused by the COVID-19 pandemic in 2020 are evident, with sharp declines in trade volumes and values, highlighting the vulnerability of global supply chains during major crises. However, the subsequent recovery post-2020 underscores the resilience of international trade, driven by pent-up demand, restocking, and increased reliance on global logistics.

Importantly, the upward trajectory in premiums parallels the recovery and growth of trade metrics, indicating that the insurance industry is closely tied to global commerce dynamics. As trade volumes expanded, necessitating increased shipping activity, and trade values grew due to inflationary pressures and higher-value cargo, insurance premiums adjusted correspondingly. This alignment shows how the marine cargo insurance sector benefits from and responds to broader macroeconomic trends.

Overall, the correlation between these variables reinforces the significance of global trade as a key driver of marine cargo insurance demand and underscores the importance of maintaining risk coverage in a rapidly evolving international trade environment.

Quantity Driver: Trade Growth

As highlighted in the previous chart, Global Trade (measured by the combined value of the world’s exports and imports) has demonstrated a consistent upward trajectory over time. This steady growth underscores the resilience and importance of international trade as a cornerstone of global economic activity. However, over the last four decades, this growth has faced three notable periods of significant downturn:

  1. The Global Financial Crisis (2008–2009): The severe economic contraction during this period led to a sharp decline in trade volumes as demand plummeted, financial systems faced instability, FX rates volatility and credit availability for trade finance tightened. This event underscored the vulnerability of global trade to macroeconomic  and financial shocks.

  2. The US-China Trade War (2016–2018): Heightened tensions between the two largest economies resulted in the imposition of tariffs, disrupted supply chains, and uncertainty in global markets. This period marked a slowdown in trade growth, particularly in sectors and regions dependent on the US-China trade corridor.

  3. The COVID-19 Pandemic (2020): The pandemic caused unprecedented disruptions, including widespread lockdowns, supply chain bottlenecks, and reduced consumer demand. Trade volumes experienced significant contractions, particularly in the early months of 2020, before recovering as economies adapted to the new normal and global demand rebounded.

Despite these challenges, the long-term trend of global trade growth remains strong, driven by technological advancements, globalization, and the expansion of emerging markets. These moments of disruption highlight the interconnected nature of the global economy and the need for adaptive strategies in managing risks, such as those provided by Marine Cargo Insurance.

Niche Trend: Increasing Global Marine Trade Flows

Global maritime trade flows have demonstrated a steady long-term growth trend, as reflected in the consistent rise in billion tons loaded over the years. This growth underscores the unparalleled efficiency of maritime shipping as the backbone of global trade. 

Maritime shipping remains the most cost-effective mode of transporting large volumes of goods over long distances, particularly for bulk commodities such as energy resources, agricultural products, and raw materials. Furthermore, advancements in vessel technology, economies of scale achieved by larger container ships, and streamlined port operations have continued to lower per-unit shipping costs, enhancing the attractiveness of maritime transport.

As global supply chains become increasingly interconnected, maritime trade flows have further benefited from the surging demand for goods driven by industrialization in emerging markets and the relentless expansion of e-commerce. This trend is also supported by policy shifts toward regional and global trade agreements, which reduce barriers and foster higher trade volumes. Combined, these factors position maritime transport as the cornerstone of global logistics, ensuring its dominance in facilitating economic growth and cross-border commerce.

Marine Trade Insurance Potential Index (MTIPI)

The Marine Trade Insurance Potential Index (MTIPI) evaluates countries based on their attractiveness and potential in the Marine Cargo Insurance market. 

The index combines four key dimensions: Trade as a percentage of GDP (40% weight), Insurance Market Maturity (measured by the share of insurance and financial services in commercial service exports, weighted at 25%), Logistics Performance (proxied by the quality of trade and transport-related infrastructure, weighted at 30%), and Long-Term Economic Growth (average annual GDP growth over the past 10 years, weighted at 5%). This multidimensional approach highlights the interplay between trade activity, insurance sector development, and the efficiency of logistics systems in driving opportunities for marine cargo insurance.

The top-performing countries on this index include Hong Kong, Singapore, Switzerland, Denmark, Lithuania, Germany, Finland, and South Korea. These nations excel due to their high trade intensity relative to GDP, sophisticated insurance markets, and world-class logistics infrastructure. For example, Hong Kong and Singapore serve as global trade and shipping hubs, while Switzerland and Germany benefit from advanced financial systems and robust export-oriented economies.

The index provides insights into varying levels of potential across a sample of 60 countries from diverse income groups and continents.

Sources & References

Allied Market research. Marine Cargo Insurance Market Expected to Reach $29.9 Billion by 2032. https://www.alliedmarketresearch.com/press-release/marine-cargo-insurance-market.html 

International Union of Marine Insurance. (2024.) Public Statistics. https://iumi.com/statistics/public-statistics 

International Union of Marine Insurance. (2024.) IUMI’s 2024 analysis of the global marine insurance market.

Jencap. (2023). Key Trends Shaping the Marine Cargo Insurance Marketplace. https://jencapgroup.com/insights/transportation-auto-garage/key-trends-shaping-the-marine-cargo-insurance-marketplace/ 

Munich Re. (n/d). Inflation and supply chain disruption are impacting marine cargo insurance. https://www.munichre.com/specialty/north-america/en/insights/inflation-and-supply-chain-disruption-are-impacting-marine-cargo.html 

UN Trade and Development. Review of Maritime Transport 2024I. https://unctad.org/publication/review-maritime-transport-2024 

UN Trade and Development. UNCTADstat Data centre. https://unctadstat.unctad.org/datacentre/ 

World Bank. (2024). GDP growth (annual %). https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG 

World Bank. (2024). Insurance and financial services (% of commercial service exports). https://data.worldbank.org/indicator/TX.VAL.INSF.ZS.WT 

World Bank. (2024). Logistics performance index: Quality of trade and transport-related infrastructure (1=low to 5=high). https://data.worldbank.org/indicator/LP.LPI.INFR.XQ 

World Bank. (2024). Trade (% of GDP). https://data.worldbank.org/indicator/NE.TRD.GNFS.ZS 

World Trade Organization. (2024). WTO Stats. https://stats.wto.org/