A larger global fleet, rising vessel valuations, and a weaker dollar are driving up premium figures, even in the absence of any actual rate increases.
The international ocean hull <a s (IUMI) Ocean Hull Committee, speaking at the organization's annual conference in Rotterdam.
Latest research from IUMI values the global hull premium base at $10.5 billion for 2025, marking a 9.4% increase over the previous year, with Europe responsible for 51.3% of that total.
Tsakiris cautioned that the headline figure doesn’t tell the full story.
“A 9.4% increase in premium income needs to be viewed in context,” he said. “Fleet growth, elevated vessel values and exchange-rate movements all contribute to that increase. Headline premium growth should not be mistaken for stronger rates or improved underwriting profitability. Despite the increase in premium income, the underlying hull market continues to soften.”
Growth without a single rate increase
Tsakiris was blunt about what’s actually driving the premium figures upward. A bigger fleet, higher vessel values and a weaker US dollar have all pushed the number up “without a single rate going up,” he said.
“It is not a hardening market; it’s a softening market that looks like a growing one,” Tsakiris added.
He noted that established insurers are fighting to maintain market share as new capacity enters the sector, providing brokers with more alternatives and leading to consistent renewal reductions. He further warned that the drive to maintain or expand premium income appears to be impacting risk selection, stating, “retaining income should never come at the cost of weaker technical underwriting.”
Premium growth across major regional markets has been relatively consistent, with both Europe and Asia recording increases of roughly 6-7%. Latin America saw stronger growth, although it still represents a much smaller portion of the global hull market.
An ageing fleet is creating a quiet, compounding cost problem
The global fleet continues to expand, though at a slower rate than in previous years, with growth projected to hit approximately 3% by the end of 2026. Because vessel scrapping remains low, the merchant fleet is steadily aging, with the average ship now 22.4 years old.
Older vessels require more frequent repairs and maintenance, while shortages of spare parts—particularly for aging ships—are pushing up claims costs. IUMI’s underlying claims data shows that machinery issues accounted for 47% of claim volume and 43% of total costs. Tsakiris noted that claims in the $10,000 to $500,000 range are becoming more frequent, representing the type of attritional cost pressure that undermines technical profitability even in the absence of a major catastrophic loss.
Heightened Port State Control activity in several regions is adding further pressure, increasing the likelihood of inspections, detentions, and repair requirements for both shipowners and their hull underwriters.
Loss ratios look reasonable, but the comparison is uneven
Reported loss ratios appear relatively favorable in several key markets, though these figures are calculated using different accounting methods and should not be viewed as directly comparable metrics for underwriting profitability.
The 2025 estimate for Europe is approximately 60% on an incurred basis, which includes an allowance for claims that have not yet been reported, suggesting a return to more typical levels <a Although we are yet to see any meaningful rise in weather-related claims, this represents an additional risk of which we must remain conscious," he said. "We are also seeing a resurgence of piracy activity, which must be taken seriously."
He also pointed to a structural shift in the relationship between hull and war risk insurance. Historically, hull <a Our market is characterised by a growing fleet, elevated vessel values, a changing geopolitical landscape and the potential for significant attritional losses. Whilst we are seeing growth in global premium, the underlying story is one of a softening market combined with a wider portfolio of risk."
