Outgoing IUMI chair Richard Turner noted yesterday morning September 19th when introducing the common theme for this year’s conference in Chicago that, when the IUMI committee chose this year’s common theme of “Adapting To A World In Transition” the members of the committee little knew that within days Russia would invade Ukraine. As a result, between then and now, there had been even more transition than could possibly have been imagined.
Following a welcome by Michael Csorba, chair of the host association AIMU, Turner said that 585 delegates were in attendance, even though delegates were missing from a few countries who would have liked to have been present.
A minute’s silence was held for Queen Elizabeth II, whose state funeral was on Monday.
Turner emphasized that, despite IUMI having to be held online for the past couple of years, with the association being run from people’s front rooms for more than a year, the pandemic years had not been “frittered away”. He said that the secretariat adapted remarkably well to Covid-19 and the challenges that came with it – not least a threat to the association’s financial income – had been overcome. The association booked a profit for last year, although a small loss was expected for 2022.
Several other initiatives were brought forward during the pandemic years. These included two Asia forums and several educational initiatives. IUMI also became a supporting partner for the newly created Poseidon Principles.
Membership remained steady, even increasing a little, costs were cut and a balanced budget was achieved.
All of IUMI’s Professional Partners stuck with the association – with five more joining this year – with five more joining this year.
The hull and cargo tutorials, part of IUMI’s focus on education, had been attended by 265 students.
Sanjiv Singh announced the launch of Masterclass in Cargo Insurance. The first course will be held in March 2023 in London. It will consist of five modules over 3.5 days and has been designed for senior cargo insurance professionals.
Once it has been stabilized in London IUMI will think of expanding into other geographies, said Singh. The course will consist of:
- Contracts of affreightment
- International programmes
- Coverage extensions
- Cat risks accumulation and ESG
- Geopolitical aspects.
Turner also noted that “for many years IUMI has been an important source and communicator of data”, and that this meant the association was moving from the deployment of data to a platform where it was publishing key industry information.
Turner observed that “the growing climate emergency, the rise of protectionism affecting international trade and the emergence of data and technology as a driver of huge change in all sectors have different ramifications for the world, international trade and by extension for us as a marine insurance sector.”
Turner said that part of the longer-term solution for the marine insurance industry lay with better data and an increased focus on ESG (Environmental, Social & Governance) issues.
“It is no exaggeration to foresee that the whole operation of our sector will be revolutionized by the harnessing of better data and the opportunities presented by digitalization. Many of the more repetitive (unproductive) human tasks in our industry will increasingly be managed with AI or software. The whole concept of what it means to be an underwriter, a claims practitioner, or a surveyor – all of these roles will be updated. This activity need not be to the detriment of client service. In fact, some of the new digital capabilities offer the prospect of better service and even new forms of coverage”, he said.
Turner felt that ESG would be “a dominant catalyst for change in our sector in the next few years. It is simply not credible for the marine insurance industry merely to ‘spectate’ on the issue and leave it to the ‘industry’ to resolve the problems. The growing pressures in society, in politics and regulation and in terms of investor expectations require us to participate and act.”
The increasing frequency and severity of storms, fires and floods, coupled with changes to the ships, rigs and cargoes which IUMI members are protecting, would put pressure on the viability of some clients and sectors, Turner felt.
He noted that IUMI had significantly stepped up its engagement in ESG, becoming a Supporting Institution for the UN’s Principles for Sustainable Insurance (2020); signing the Neptune Declaration in support of seafarers’ rights and welfare (2020); forming an ESG Working Group (2021); and becoming a Supporting Partner of the Poseidon Principles for Marine Insurance (2021).
He told the audience that IUMI was reflecting on its long-term future under the banner of IUMI 2030, with various workstreams already underway.
“No organization can simply stand still. We cannot simply assume that the work we did in the last decade will be sufficient to see us through the next decade. The wider changes in the world make such an outcome unlikely. We will need to evolve if we are to stay relevant to the sector we represent.”
Turner highlighted IUMI’s enhanced presence at the International Maritime Organization (IMO), with the association lobbying harder for improvements to containership fire protection as well as close involvement in work related to autonomous ships, ports of refuge and the growing problem of containers being lost overboard at sea.
The assets that marine insurers were protecting would change. There would be a shift in assets and types of assets (fossil fuels to renewables, older less environmentally friendly ships to newer, more complex vessels). Some industries would shrink while others would grow.
One impact of sanctions that would be reflected in ESG was that insurers would move beyond simply complying with the rules, Turner felt. They would often go beyond the legal requirements.