Shipping total losses hit record low but clouds on the horizon

by | 29th June 2023 | The Naval Architect - News, Commercial Shipping

Home News Shipping total losses hit record low but clouds on the horizon

Fire risks are a growing concern

Total losses in global commercial shipping hit a record low in 2022, according to the annual safety and shipping review published by insurance provider Allianz Global Corporate & Specialty (AGCS).

Worldwide, 38 ships were lost last year, 35.6% fewer than the 59 vessels lost in 2021. This is the lowest level of loss in 12 years, since the annual review was first published. The figure also represents a 65% reduction from a decade ago: in 2013, 69 vessels were lost.

“Shipping losses have sunk to the lowest number we’ve seen in the history of our annual study, reflecting the positive impact that safety programmes, training, changes in ship design and regulation have had over time,” states Captain Rahul Khanna, global head of marine risk consulting at AGCS.

South China, Indochina, Indonesia and the Philippines accounted for one in four of the losses. This is the result of “high levels of local and international trade, congested ports, older fleets and extreme weather”, according to the report.

Although losses declined over the past year, the number of shipping casualties or incidents reported remained consistent in 2022 totalling 3,032, compared to 3,000 a year earlier.

AGCS is concerned about the number of fires with 200 reported last year, making it the third largest cause of maritime casualties. The increased trade in lithium-ion battery transportation generated by decarbonisation poses a significant fire risk for the shipping industry, it says.

Further, AGCS points to emerging challenges from the growing ‘shadow fleet’ which it estimates could now account for one fifth of the oil transportation fleet.

The number one cause of marine claims by value is fire and explosion.

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