America’s Cup has implications for insurers of ‘ordinary’ yachts

The ever-increasing pace of technological innovation in the racing-yacht world has important implications for marine insurers, because the forefront of technological advance today will be the norm on production yachts tomorrow, according to MS Amlin in its latest “Insights”.

Keith Lovett, a senior underwriter with the firm who also works on product development for MS Amlin’s yacht and marine team, observed that late last year Beneteau, a leading designer and builder of yachts, was putting into full production a monohull racing yacht, with foils – specifications previously reserved for top-of-the-line bespoke racers.

“Technology has moved forward rapidly in the last two years, primarily driven by the big catamarans,” said Lovett. “We could see straight away that this was going to have an impact on our business. That’s because the risks are relatively unknown. With traditional boat building, which for many years has been dominated by fibreglass hulls, you have plenty of historical data to base your judgement on. But this is all new. But we’re putting our time into understanding it better.”

He noted that yacht design had come a long way since the 1960s, when wooden hulls gave way to fibreglass. Today there are exotics, usually carbon derivatives, sometimes without even a solid hull – just the exotic materials stretched over a frame.

“If you’re in the business of insuring these vessels you have to stay ahead of the curve”, said Lovett, noting that the America’s Cup had been “a gamechanger”, not least because of the millions of pounds in sponsorship now available.

“The heightened interest in the America’s Cup delivered the impetus for technology to move forward faster than it would normally have done,” said Lovett, adding that “about three years ago we realized that it was inevitable that this technology was soon going to be available to the wider yachting community. Now the first production racing yachts are coming on to the market, it’s going to move into cruising yachts in the not too distant future.”–and-its-ha.html