Transcript PowerPoint (file size: 6.5 MB) - Houston

WELCOME
Houston Marine Insurance
Seminar
Tuesday, October 1, 2013
48th Anniversary
www.houstonmarineseminar.com
Marine Hull Insurance
Innovation or Evolution?
Norwegian Hull Club
 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!
Innovation or Evolution?
Source: Flickr
 Objects insured
 Policies underwritten
 Terms offered
Agenda
I.
II.
III.
IV.
V.
Marine or Energy?
Risk Assessment of the OSV market
Insuring the OSV market
Client Services
Summary
I. Marine or Energy?
 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?
Offshore Support Vessel Market
 From Offshore Support to Well Intervention
 Technological Innovations
 Subsea Construction (Deeper Waters)
 Well Intervention (Increased recovery from wells)
Source: Offshoreenergytoday.com
Demand Drives Innovation

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
 LOA 88m
 H&M Value Index 1
 LOA 157m
 H&M Value Index ?
45
Source: DOF
I.
Summary
 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?
II.
Risk Assessment of the OSV Market
 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.”
Client Risk Assessment
Sliding Left:
 From
 UWR Experience
 To





Supporting Tools
Client Experience
Pricing Tools
Internet Sources
More UWR
Experience
CRA – Client Risk Assessment
 NHC/ DNV Project
 Define your own
parameters
 Soft Factors
 Safety Culture
 Organization
 A Supportive Tool
II. Summary
 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
III. Insuring the OSV Market
 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
Insuring the OSV Market
 Develop a pricing tool based
on statistics(CEFOR)
 Driving by looking in the rearview mirror?
 Incorporate Global trends
(2007 – The annul horribilis
for the H&M market?)
 It is about what will happen,
not what has happened.
Source: CEFOR
Technical Loss ratio
Markets
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.
III. Summary
 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!
IV. Expect More
 Sustainable service platform
 Terms and Conditions
 Capacity/Rating
 Claims Services/Emergency Support
 Client Services
 Understand the needs of your clients and members
 Experience Transfer
CLIENT SERVICES
SUMMARY
 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!