Houston Marine Insurance Seminar Tuesday, October 1, 2013 48 th Anniversary
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Transcript of Houston Marine Insurance Seminar Tuesday, October 1, 2013 48 th Anniversary
Houston Marine Insurance Seminar
Tuesday, October 1, 2013 48th Anniversary
WELCOME
www.houstonmarineseminar.com
Innovation or Evolution?Marine Hull Insurance
Founded in 1837 as a mutual hull club Based in Norway, 3 offices 9000 vessels insured
95% of the OSV fleet in Norway 70% of Mobile Offshore Units worldwide
Claims lead – 4800 vessels More than a capacity provider – Expect
More!
Norwegian Hull Club
Innovation or Evolution?
Objects insured Policies underwritten Terms offered
Source: Flickr
I. Marine or Energy?II. Risk Assessment of the OSV marketIII. Insuring the OSV marketIV. Client ServicesV. Summary
Agenda
Classification Society definitions Notations : Drill, Well …
“Worldwide struggle for consensus over FPSOs” Tradewinds Aug. 2013
Insurance Market As long as you get the most competitive terms?
I. Marine or Energy?
From Offshore Support to Well Intervention
Technological Innovations Subsea Construction (Deeper Waters) Well Intervention (Increased recovery from wells)
Offshore Support Vessel Market
Source: Offshoreenergytoday.com
“Cutting-edge conveyance systems, state-of-the-art tools and innovative
ways of using proven, conventional methods are being developed to
transform what is often a cost-prohibitive and risky undertaking into a
viable option for operators.”
Demand Drives Innovation
“The combination of ultra-deepwater and pressures of 15,000 psi is really
going to push the envelope on this technology.”
BP Group Chairman said that Aberdeen and other UK centres had developed “a microcosm of technological innovation.”
Experience – Offshore Supply
Developement of GT,SI and Deductible
Values
Source: DOF
LOA 88m H&M Value Index 1
LOA 157m H&M Value Index ?
45
Marine or energy discussion will continue …
There is innovation in the design
Set your own guidelines based on operations and qualified parameters set by Class, etc.
Ask yourself: What is the rationale for the (high) Sum Insured?
I. Summary
Risk Assessment will be the next step.
Question: Is the insurance market able to do a proper risk assessment of innovative design?
“It is better to be vaguely right than exactly wrong.”
II. Risk Assessment of the OSV Market
Sliding Left: From
UWR Experience
To Supporting
Tools Client
Experience Pricing Tools Internet
Sources More UWR
Experience
Client Risk Assessment
NHC/ DNV Project
Define your own parameters
Soft Factors Safety Culture Organization
A Supportive Tool
CRA – Client Risk Assessment
Understand the operation and trade Develop unemotional Risk assessment
supportive tools for selection of risk Apply Underwriter Experience Constantly try to look beyond the horizon for
changes and innovation within the segment
“Risk comes from not knowing what you're doing.” – Warren Buffett
II. Summary
Marine Insurance Market
Nordic Marine Insurance Plan of 2013 is an all-risks set of conditions
Agreed document between the Nordic Association of Marine Insurers (CEFOR) and the Nordic Shipowners’ Association
Latest revisions are the only set of conditions offered and used
Revisions reflect, amongst other things, the innovation and evolution of the market insured
Major evolutionary and experience-driven updates to Chapter 18 – Insurance of Mobile Offshore Units
III. Insuring the OSV Market
Develop a pricing tool based on statistics(CEFOR) Driving by looking in the rear-
view mirror? Incorporate Global trends
(2007 – The annul horribilis for the H&M market?)
It is about what will happen, not what has happened.
Insuring the OSV Market
Source: CEFOR
Technical Loss ratio
Today Over capacity Low barriers to entry
Trends Banks – Basel III
Allocation of capital more selective (less shipping)
Insurance Industry – Solvency II Allocation of capital based on risk profile? Lloyds PMD board – Tradewinds aug. 2013
Various ways of doing this have been suggested, said Mr. Indge, with marine hull underwriters collaborating with various registers, classification societies and the International Maritime Organization to improve their understanding of the risks they insure.
Markets
Trust your Risk Assessment
Understand the operation and trade in order to offer the best set of conditions to your client
Develop and constantly revise pricing tools
Stay Disciplined!
III. Summary
Sustainable service platform Terms and Conditions Capacity/Rating Claims Services/Emergency Support
Client Services Understand the needs of your clients and
members Experience Transfer
IV. Expect More
CLIENT SERVICES
Within the OSV market there is Innovation in technology Evolution in the insurance market
In order to stay on top as an insurer Keep a strong technical and operational focus Understand your client Develop and revise Risk Assessment tools Develop and revise Pricing Models Stay Disciplined!
SUMMARY