In recent years, within the Global Boat Insurance market, we’ve seen the average cost of Boat Insurance increase for the majority of Yacht Owners.
As some Yacht Insurance Companies have contracted from the market, we’ve seen as a result a reduction in capacity, competition and therefore an increase in the overall Yacht Insurance Prices.
To explain more, about the key reasons for this recent trend for the average cost of Yacht Insurance increasing within the Global Boat Insurance market, please see as follows:
- In 2017, The Global Boat Insurance market was stretched with three major hurricanes, Hurricane Harvey, Hurricane Irma and Hurricane Maria, which cost an estimated total £214 Billion according to a 2018 Market Insights Report published by Lloyds. (This includes boats of all sizes, residents, resorts and valuable cargo etc).
Photo Source: The following photo was taken after Hurricane Irma in the British Virgin Islands. Original photo source from News Article: Strengthening Hurricane Maria a threat to Irma-hit Caribbean
- For several years major underwriters incurred year on year losses and it was discovered that at least 75% of Yacht Insurance Brokers had Boat Insurance Policies, that were unprofitable or with thin margins, leaving the Global Boat Insurance market exposed to underpriced premiums.
- The Global Marine Insurance market has seen some substantial Boat Insurance Claims linked to Superyachts, where in one particular case there was a reported loss of between $650 Million to $1 Billion Dollars, following a fire at a shipyard in Germany involving a new Superyacht. This is one of the World’s largest Marine Insurance Claims ever.
Photo Source: The following photo was taken when the fire broke out at the Lürssen Shipyard in Germany. Original photo source from News Article: More than 150 firefighters called to major blaze at Lürssen shipyard
- At the end of 2018, at least a dozen Yacht Insurance Companies decided to contract from the Global Boat Insurance market or to even close their doors altogether, therefore leaving a reduction in capacity and competition. The result being an overall increase in Yacht Insurance Prices for Yacht Owners in the UK, Europe, Caribbean and Globally.
- The remaining Yacht Insurance Companies within the Global Boat Insurance market are now being even more prudent about risk and therefore carefully structuring Boat Insurance Policies to effectively manage coverage. As a result, we’ve seen the Average Cost Of Boat Insurance increasing, within the Global Boat Insurance market in recent years.
- Following all the above, some Yacht Insurance Brokers are now asking more questions about Yacht Owners, to ensure they can provide the right coverage at the right price. For example, more details about Hurricane Plans, History, Yacht Management & Location etc. If required, additional premiums or exclusions are being added to Boat Insurance Policies.
Summary Of The Average Cost Of Boat Insurance Increasing Within The Global Boat Insurance Market
It has been reported that the average cost of boat insurance has increased globally by 30% to 80% and more specifically 50% to 70% within the London market. However, of course, there are many different variables to Yacht Insurance Prices and these will depend on many factors.
Some Yacht Insurance Companies, will exclude Hurricane risk areas during the Hurricane season, even if you have a good Hurricane Plan and some Yacht Insurance Companies will offer Hurricane coverage for an increased premium.
Despite several Yacht Insurance Companies contracting from the Global Boat Insurance market, the remaining Yacht Insurance Brokers are committed to the industry and most Yacht Owners will be able to get the Full Boat Insurance Coverage they want, despite potentially paying more in the short term.
Providing we don’t see anymore major Hurricane losses or major incidents involving Grounding, Fire or Sinking within the Global Boat Insurance market in the coming years, we’ll expect more Yacht Insurance Companies to return to the market and therefore Yacht Insurance Prices to stablise for Yacht Owners.
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