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March 12, 2024

Yacht Market Update 2024: Cruising Rough Waters

James Bishop,  Yacht Specialty Leader

Navigating the Yacht Insurance Market in 2024 and Beyond

Yacht owners have been facing one of the most challenging yacht insurance markets in a generation. Today’s challenges can be traced back to a series of significant weather events, an extended soft market, and significant changes in reinsurance that have shaped the industry since the 2017 hurricane season. The devastation caused by Hurricane Ian in 2022 serves as the latest reminder of the market's vulnerabilities.

The stormy path to 2024

The journey to our current state of the market began even before the pivotal 2017 hurricane season, a season marked by a trio of devastating hurricanes: Harvey, Irma, and Maria. These three storms, among the top five costliest in history, were part of the natural catastrophe-related events in 2017 that inflicted around $330 billion in insured and uninsured economic losses. 1 The losses came mostly from hurricanes, severe storms, wildfires, floods, and other weather events in North America, the Caribbean, and Europe. 

For years leading up to 2017, yacht insurance rates plummeted as an influx of competition between carriers created a rate environment that was unsustainable for many insurers operating in the sector at the time. This was also aided by much cheaper reinsurance rates for the yacht business. This low-rate environment changed instantly after hurricanes Harvey, Irma and Maria. Hurricane Maria, in particular, wreaked havoc in the Caribbean, devastating numerous charter bases and hundreds of yachts. 

The repercussions of these storms extended far beyond immediate damage and losses, significantly impacting the global reinsurance market. A fire at a renowned yacht builder that constructs some of the world's largest yachts further strained the yacht insurance market when a 430’ mega-yacht went up in flames, dealing another blow to an industry already reeling from natural disasters.

After the devastation from the events of 2017/2018, Lloyd's of London, a pivotal player in insurance, addressed profitability concerns in the yacht insurance market. In the subsequent nine months, there was a staggering 70% reduction in market capacity in London alone. This reduction had a cascading effect, prompting U.S. admitted carriers to tighten their underwriting guidelines and appetite to avoid taking on the business that was exiting the London market.

The final blow came in the form of Hurricane Ian in 2022. This catastrophic event prompted almost every admitted carrier in the yacht insurance market to reassess their guidelines and appetite. They also dealt with large increases in the cost for their reinsurance for 2023. Some carriers reported an increase in their reinsurance programs of up to 30%, while others found the cost of reinsurance to be prohibitively expensive, leading them to take underwriting action such as lowering their maximum limits or dropping windstorm coverage. 

The impact on yacht owners

The repercussions of this hard market and the coverage challenges are being felt by yacht owners across the board. Florida, due to its vulnerability to hurricanes and the potential impact on reinsurance, has borne the brunt of these changes. The overall market conditions have brought larger windstorm deductibles, difficulty in getting windstorm coverage, new lightning deductibles, as well as significant premium increases at renewal and much higher premiums on new policies. 

The most disruption is happening in the following areas:

• Owner-operators in Florida with yachts 65’ and above: These individuals face increased scrutiny and higher rates due to the lack of full-time captain or crew. Most carriers now require a captain on this size yacht.
• Absentee owners in Florida: Owners who are not present year-round may find it more challenging to secure coverage, even with a comprehensive storm plan.
• Large center consoles in Florida with three engines or more: Increased underwriting scrutiny affects this category of vessels due to increased popularity of this segment and continued concern over speed and theft exposure.
• Older yachts over 15 years of age: The age of the vessel can influence rates and availability especially when most carriers are replacing “new for old” with regards to parts and systems in a partial loss claim.
• Yachts moored in the Bahamas or Caribbean: Geographic location plays a significant role in risk assessment, and these areas are seen as much more vulnerable to hurricanes.
• Boats kept on lifts with no comprehensive storm plans: Adequate storm preparedness is paramount, but there have been many losses in past hurricanes where the lift failed, or the boat came off the lift.
• Owners with prior losses: Loss history plays a big part in risk assessment especially for an unfavorable loss history. Carriers have declined accounts with only one prior loss. 

Even the mega-yacht market, which has remained a little more stable, is not immune to the challenges. Many yacht owners have experienced premium increases of 20% or more in the past year or two, and there is increased scrutiny on captain and crew qualifications, cruising itineraries, and timing of yard periods.

Mitigating the challenges

Given these challenges, it's crucial for yacht owners to take proactive steps to navigate the evolving landscape:

Create comprehensive storm plans. Beyond merely storing your yacht, consider detailed storm plans that include a storm-rated storage location or removing your yacht from the area altogether.

Maintain owner-operator credentials. If you own a yacht longer than 65’, maintain a detailed resume of boats owned, waters navigated, and any relevant training or credentials, such as a USCG license.

Implement security measures for center console yachts. For larger center console vessels with outboards, install an active theft-tracking system and consider mechanisms to disable the outboards.

Obtain updated surveys. If you are considering exploring new carrier options, it will be important for your yacht to have an updated survey conducted by a NAMS/SAMS surveyor in the last 24 months.  

Consider relocation. If possible, contemplate moving your yacht out of Florida during hurricane season to reduce exposure.

Plotting a course forward

As we face the challenges of the yacht insurance market in 2024 and beyond, it's essential to recognize the complex web of factors that have brought us here—climate change, natural disasters, capacity fluctuations, and reinsurance dynamics have all contributed to this challenging landscape.

To navigate these turbulent waters, partnering with experienced yacht insurance professionals who understand the intricacies of this evolving market is essential. Trusting in a team that can secure coverage when others cannot is often your best course of action in these uncertain times.

Yacht owners must adapt to this evolving landscape by being proactive, educated, prepared, and well-informed. The journey ahead may be challenging, but with the right strategies and partners, your vessel can continue to cruise smoothly, even in the face of uncertainty.

Contact the Yacht Team at Marsh McLennan Agency Private Client Services for a complimentary risk consultation to help you explore your options.

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Justices Side With Insurers in Rare Fight Over Yacht Policy

By Daphne Zhang

The US Supreme Court ruled in favor of a Munich Re unit against a Pennsylvania yacht owner in a marine insurance dispute, emphasizing the need for predictability in maritime contracts.

The case revolves around a choice of law provision in Raiders Retreat Realty Co.’s policy with Great Lakes Insurance SE. The provision said federal admiralty law would be used to resolve any disputes, with New York state’s insurer-friendly law serving as the backup.

“Choice-of-law provisions in maritime contracts are presumptively enforceable under federal maritime law, with narrow exceptions not applicable here,” the Supreme Court held in a unanimous opinion on Wednesday written by Justice Brett Kavanaugh.

Courts can refuse to apply the provision if it violates public policy. However, the parties disagree over whether federal or state public policy can void the provision. The Supreme Court reversed a Third Circuit decision that said last year that Pennsylvania’s insured-friendly public policy prevents carriers from implementing the choice of law clause.

“A federal presumption of enforceability would not be much of a presumption if it could be routinely swept aside based on 50 States’ public policy determinations,” Kavanaugh wrote in the opinion. “The ensuing disuniformity and uncertainty caused by such an approach would undermine the fundamental purpose of choice-of-law clauses in maritime contracts: uniform and stable rules for maritime actors.”

Great Lakes appealed the case to the US high court, saying the Third Circuit’s approach creates uncertainty by allowing different states to apply their own policies to override maritime contracts.

But Raiders asked the high court to respect that insurance matters are governed by state law. It pointed to the Supreme Court’s 1955 decision in Wilburn Boat Co. v. Fireman’s Fund , which held that state law governs marine insurance contracts when there is no federal law.

The choice of law provision is prevalent in both maritime contracts—used by cruise lines, cargo carriers, and shipbuilding facilities—and marine insurance policies that cover the transportation of goods over land and sea. Key maritime players, from ferry operators to offshore energy and construction companies, have been closely watching the case.

The case stems from a June 2019 accident when Raiders’ yacht ran aground near Fort Lauderdale, Fla., sustaining at least $300,000 in damages.

Great Lakes is represented by Sullivan & Cromwell LLP and The Goldman Maritime Law Group. Raiders is represented by the Law Offices of Howard J. Bashman, Jenner & Block LLP, and Goldstein Law Partners, LLC.

The case is Great Lakes v. Raiders , U.S., 22-500, 2/21/24.

To contact the reporter on this story: Daphne Zhang in New York City at [email protected]

To contact the editors responsible for this story: Anna Yukhananov at [email protected] ; Patrick L. Gregory at [email protected] ; Michael Smallberg at [email protected]

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Securing Yacht Insurance in 2022: Market Dynamics & Smart Strategies

By gowrie group, brewer yacht sales’ marine insurance partner.

Today’s marine insurance marketplace is complex. The dramatic increase in boat purchases amid the pandemic during 2020 and 2021, by both new boaters and current owners looking to upsize, has significantly impacted the marine supply chain and the insurance market. The increase in demand for new yacht insurance policies from first-time boat owners and current boat owners is resulting in substantial pressure on an already complex and competitive marine insurance market.  

To successfully navigate today’s insurance marketplace, Gowrie Group strongly recommends that boat owners and prospective buyers  align with an experienced marine insurance advisor early in their boat buying process.  Gowrie Group, one of the nation’s leading yacht insurance agencies, and John Wenz, a marine insurance specialist at Gowrie Group, are dedicated to helping  Brewer Yacht Sales clients  navigate the insurance process.  While the reality of today’s insurance marketplace can feel overwhelming, John Wenz is available to help every step of the way. John and his team at Gowrie Group are not only experienced in marine risk management but also have access to a wide range of marine insurance carriers and solutions. Engaging an insurance expert early in the boat buying process allows for ample time to explore multiple options and secure the best insurance solution possible. 

Creating an Attractive Insurance Application for Submission.   John works with clients to navigate through even the most challenging insurance placements. His goal is to obtain the right insurance solution for each client, so they can get out on the water and enjoy their boat! In addition to the yacht insurance application, John helps clients to assemble the following supplemental materials and details to make each yacht insurance submission as attractive as possible to the insurance companies and underwriters. 

Ten Important Supplemental Materials & Factors for Obtaining Yacht Insurance:

• Partnering with an experienced yacht insurance agent early in your boat buying process
• Boating Resume that details your boating experience, certifications, prior ownership history, expertise areas, etc.
• Information about prior boat ownership of similar sized vessels (if no prior ownership, a captain may be required initially)    
• Captain and/or Paid Crew resumes and claims history (if applicable)
• Recent accredited NAMS/SAMS marine survey (less than 3 years old), including confirmation of survey recommendation completion 
• Detailed Hurricane/Storm Plan if your boat will be in areas prone to Hurricanes or severe weather patterns 
• Absentee Owner Plan – if your boat will be left unattended for periods of time
• Maintenance service records, as these may be needed in the event of a claim or if an insurance company asks for proof of improvements  
• Boating safety and claims record is an important underwriting factor  
• Consider including your personal insurance portfolio (homes, autos, valuables) as part of a packaged submission with your request for marine insurance

Request an insurance review and quote from Gowrie Group:

• Contact John Wenz directly at  [email protected]  or  860-399-3653
• Request a quote online by completing this form at  www.gowrie.com/boatquote (use promocode = BYS)

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15 best boat/yacht insurance companies heading into 2024.

In this article, we will look into the 15 best boat/yacht insurance companies heading into 2024. If you want to skip our detailed analysis, you can go directly to the 5 Best Boat/Yacht Insurance Companies Heading into 2024 .

Boat/Yacht Insurance Industry: A Market Analysis

According to a report by Verified Market Research, the global boat/yacht market was valued at $930 million in 2021. The market is expected to grow at a CAGR of 3.96% and reach $1.37 billion in 2030. The growth is driven by the coverage of third-party liability and the availability of personal accident coverage.

I0T is a major factor expected to contribute to the market growth. According to International Business Machines, a US-based multinational technology company, over 80% of insurers are anticipated to generate increased revenue by employing a digital platform. It is expected to increase the revenue growth by 15% for many insurance companies. The rising demand due to increasing accidents and losses is another factor contributing to the growth.

Segment-wise, the market is categorized into Actual Cash Value and Agreed Amount Value based on type. The Actual Cash Value is projected to hold a significant share of the market by 2030, driven by features such as re-arranged boat value, receiving the boat’s total value back on claim approval, and easy application and appraisal process.

Regionally, the global boat/yacht market is expected to be dominated by Europe and is expected to hold the largest share over the forecasted period. The growth is driven by the positive impact of marine transport on the European market. Asia Pacific is expected to grow at the highest rate. The increased tourism activity and rise of IoT services in Asia Pacific are likely to boost the growth in the Asia Pacific.

Key Players in the Market

Some of the prominent names in the market include Aviva plc (OTC: AVVIY ), Allianz SE (OTC: ALIZF ), and Markel Group Inc. (NYSE: MKL ).

Aviva plc (OTC:AVVIY) is one of the top British multinational insurance companies. On December 5, the company announced that its network of vehicle damage repair centers, Solus, had expanded to Newport, Wales with a brand-new center. This center marks the first-ever Solus site in the country and articulates the company's commitment to facilitating customers post-accident. The new center is located at St. Modwen Park, boasting a wide area of 23,000 ft². The center will be able to create over 30 jobs and handle 25% of the company's motor damage claims, joining a network of 22 centers across the UK. The facility also boasts sustainability features such as solar panels and rainwater harvesting, further enhancing the site's appeal.

Allianz SE (OTC:ALIZF) is a German multinational financial services company, specializing in insurance and asset management. On December 19, the company announced that it had re-entered the insurance securities market after a decade. The company had issued a €250 million catastrophe bond, guarding itself against European windstorms for the next three years from 2024 to 2026. This is a significant step by Allianz SE (OTC:ALIZF) to diversify its reinsurance portfolio and foster its defense against a primary natural threat. The bond was issued through Blue Sky Re DAC and initiated by an industry loss index. It was well-received by investors, emphasizing the rising appeal of the risk transfer mechanism. This move shows Allianz SE's (OTC:ALIZF) proactive approach to mitigating risks and securing long-term protection against natural disasters.

Markel Group Inc. (NYSE:MKL) is a diverse group of insurance companies, operating across multiple lines of insurance businesses. On October 20, the company announced that it had invested in Certa, a London-based tax insurance specialist. The company had taken a 49% stake in the company. The strategic acquisition aims to fuel the company's product development and geographic expansion. It utilizes Markel Group Inc.'s (NYSE:MKL) expertise and global reach to strengthen Certa's niche offerings in tax and contingent risk insurance. This transaction pledges to provide enhanced capabilities, expanded product lines, and crucial capacity support to Certa's growth plans, making it a leader in the tax insurance market.

With this context, let's have a look at the 15 best boat/yacht insurance companies heading into 2024.

Methodology

To compile our list of the 15 best boat/yacht insurance companies heading into 2024, we opted for a consensus approach. We looked through multiple market reports including, Allied Market Research, Verified Market Research, Mobility Foresights, and Business Research Insights to look for major public and private companies operating in the boat/yacht insurance market. We then sourced market caps of public companies from Yahoo Finance and the annual revenue for private companies from their websites. We have ranked the 15 best boat/yacht insurance companies heading into 2024 in ascending order of market capitalizations, as of December 19, 2023, and annual revenue.

By the way, Insider Monkey is an investing website that tracks the movements of corporate insiders and hedge funds. By using a consensus approach, we identify the best stock picks of more than 900 hedge funds investing in US stocks. The top 10 consensus stock picks of hedge funds outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years ( see the details here ). Whether you are a beginner investor or a professional one looking for the best stocks to buy, you can benefit from the wisdom of hedge funds and corporate insiders.

15. Aviva plc (OTC:AVVIY)

Market Cap as of December 19: $14.89 billion

Aviva plc (OTC:AVVIY) is one of the best insurance companies, headquartered in London. The company specializes in retirement, investments, insurance, health, insurance technology, and protection. Aviva plc (OTC:AVVIY) offers a variety of boat insurance solutions for sail, jet, sport, fishing, cruiser and cuddy, houseboats, pontoon, runabout, and personal watercraft. It is ranked among the 15 best boat/yacht insurance companies heading into 2024 and is valued at $14.89 billion, as of December 19.

14. Sompo Holdings, Inc. (OTC:SMPNY)

Market Cap as of December 19: $15.58 billion

Ranked 14th on our list, Sompo Holdings, Inc. (OTC:SMPNY) is a leading Japanese insurance holding company. With over 130 years of experience, the company has businesses in over 29 countries. Sompo Holdings, Inc. (OTC:SMPNY) provides domestic P&C insurance, overseas insurance and reinsurance, domestic life insurance, nursing care & seniors, and digital insurance products and services. Its marine insurance provides coverage for marine cargo, inland marine, and species risks. The company's suite of offerings includes both mono-line and marine packages, tailored to the dimensions and complexity of the exposure. As of December 19, the company boasts a market cap of $15.58 billion.

13. Markel Group Inc. (NYSE:MKL)

Market Cap as of December 19: $18.64 billion

Markel Group Inc. (NYSE:MKL) is a holding company, with insurance as its core business. The company leads the insurance market worldwide with operations in the US, Bermuda, Asia, and Europe. It offers a wide range of tailored solutions for all kinds of boats including antique boats, power boats, ski boats, sailboats, fishing boats, pontoons, and pleasure boats. The company's boat insurance policies start at a low price of $100 per year. Markel Group Inc. (NYSE:MKL) is ranked 13th on our list and is valued at $18.64 billion, as of December 19.

12. China Pacific Insurance (Group) Co., Ltd. (OTC:CHPXF)

Market Cap as of December 19: $35.47 billion

China Pacific Insurance (Group) Co., Ltd. (OTC:CHPXF) is a major insurance company, headquartered in China. The company's offerings include life insurance, accident and health insurance, property insurance, motor vehicle insurance, aircraft insurance, ship insurance, goods in transit insurance, and property damage insurance among others. As of December 19, China Pacific Insurance (Group) Co., Ltd. (OTC:CHPXF) boasts a market cap of $35.47 billion. It is ranked 12th on our list of the 15 best boat/yacht insurance companies heading into 2024.

11. American International Group, Inc. (NYSE: AIG )

Market Cap as of December 19: $47.35 billion

American International Group, Inc. (NYSE:AIG) is a leading American multinational insurance company. The company offers a diverse range of insurance products and services across multiple portfolios. Its marine and boat insurance provides coverage for sinking, theft, and fire. It also covers personal liability and property damage including the crew and material things in the boat. As of December 19, American International Group, Inc. (NYSE:AIG) boasts a market cap of $47.35 billion.

10. Tokio Marine Holdings, Inc. (OTC:TKOMF)

Market Cap as of December 19: $48.01 billion

Tokio Marine Holdings, Inc. (OTC:TKOMY) is a leading insurance company, headquartered in Japan. The company has been leading the market with its insurance products and services for over the past 100 years. Its marine and boat insurance provides coverage for perils of the seas, rivers, lakes, or other waterways. It also covers violent theft, jettison, piracy, breakdown, accident, negligence, and natural disasters. Tokio Marine Holdings, Inc. (OTC:TKOMY) is ranked among the best boat/yacht companies and is valued at $48.01 billion, as of December 19.

9. MetLife, Inc. (NYSE: MET )

Market Cap as of December 19: $49.15 billion

MetLife, Inc. (NYSE:MET) is a leading insurance company, operating across various business domains including insurance, annuities, employee benefits, and asset management. It offers insurance coverage for life, accidental and health, disability, dental, and legal insurance. MetLife, Inc.’s (NYSE:MET) boat insurance provides coverage for physical damage, bodily injury, property damage, and medical payments. It is ranked among the 15 best boat/yacht insurance companies heading into 2024 and is valued at $49.15 billion, as of December 19.

8. Liberty Mutual Insurance

Annual Revenue (2022): $50.00 billion

Founded in 1912, Liberty Mutual Insurance is a leading insurance company in the United States. With over 100 years of experience, the company provides a wide range of innovative insurance products, services, and technologies. The company has operations in over 29 countries and has more than 45,000 employees. The company provides boat insurance services to boats, yachts, pontoon boats, fishing boats, and personal watercraft among others. The company reported an annual revenue of $50 billion in 2022.

7. ING Groep N.V. (NYSE:ING)

Market Cap as of December 19: $50.66 billion

ING Groep N.V. (NYSE:ING) is a leading financial services company, specializing in banking, asset management, and insurance services. The company provides insurance for all kinds of sea-related risks including storm, collision, sinking, grounding, and fire. It also covers the battery, strike, lock-out, riot, commotion, and war under its boat/yacht insurance. As of December 19, ING Groep N.V. (NYSE:ING) boasts a market cap of $50.66 billion.

6. AXA SA (OTC:AXAHY)

Market Cap as of December 19: $72.49 billion

Ranked 6th on our list, AXA SA (OTC:AXAHY) is a French multinational insurance company. The company provides insurance, asset management, and banking solutions. AXA SA (OTC:AXAHY) offers a wide range of boat insurance plans for motor boats, sailboats, or yachts. As of December 19, the company has a market cap of $72.49 billion.

Click to continue reading and see  5 Best Boat/Yacht Insurance Companies Heading into 2024 .

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Disclosure: None.  15 Best Boat/Yacht Insurance Companies Heading into 2024  is originally published on Insider Monkey.

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Insurance ban to tighten squeeze on Russian oil shipments

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Ian Smith and Harry Dempsey in London

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Brokers and underwriters gathered this week in Lloyd’s of London’s historic underwriting room to celebrate the Queen’s platinum jubilee, twice ringing the Lutine bell — a symbol of the insurance market’s shipping roots that was traditionally struck once to mark a lost vessel and twice for its safe return.

A different kind of peril now faces the centuries-old market after the UK and Brussels agreed to ban insurance on ships carrying Russian oil as they ratchet up sanctions on Moscow over its invasion of Ukraine.

The move threatens to shut one of the world’s biggest crude producers out of large parts of the maritime export market. Ships carrying Russian oil would rush to find alternative insurance, without which they would face being turned away from global ports.

Russia’s oil exports have largely held up despite western sanctions on its financial system. Industry executives say a co-ordinated insurance ban could change that and address the fundamental problem with the EU’s seaborne oil embargo: Russia can simply redirect its crude elsewhere.

“The impact of a UK and EU maritime insurance ban on ships carrying Russian oil cannot be overstated,” said Leigh Hansson, sanctions partner at law firm Reed Smith. “We’ve seen the impact the insurance ban had on Iranian oil a decade ago, and this could well send Russian oil trade down the same path.”

It is a decade since western governments first prohibited insurers from providing cover for Iranian oil shipments, as well as putting secondary sanctions on third parties that help Tehran circumvent sanctions, capping a broader package of measures and sparking an almost immediate decline in exports.

But targeting Russia, the world’s third-largest oil producer, could have a far deeper impact on global energy markets.

Insurers worry about unintended consequences for the shipping industry and global commodity markets. As they try to make sure they are not falling foul of the underwriting ban, they could overcompensate and pull cover from a wider range of vessels.

“Because these cargoes are moving quite quickly and the insurance is contracted quite immediately, it’s quite hard to do a lot of homework on the provenance,” said one senior figure at Lloyd’s. If unclear, insurers would “tend to default to a slightly harder line”.

That could mean disruption to wider supply chains, including Kazakh oil shipped through Russian ports, as insurers take a cautious view.

Industry insiders expect details on the measures in the coming days. The London market, which covers global risks, has been engaged in a furious lobbying effort since the war began to convince western policymakers to align the timing and substance of their insurance sanctions.

With a ban on insuring or reinsuring Russian aviation and space companies announced earlier this year, policies were announced by western governments on varying timelines with different messages on their scope, sparking an effort by the market to establish a common approach.

Lloyd’s on Wednesday reiterated that it was “working closely with UK and international regulators and governments” to implement sanctions against Russia, noting that its “position as both a market supervisor and insurer allows us to support various foreign policy goals”.

Shipping industry figures believe that an insurance ban would have a serious impact on Russia’s oil industry.

“It’s very substantial,” said Dag Kilen, global head of research at Fearnleys, a shipbroker. “I would expect an immediate drop of Russian oil exports because the sanctions affect long-term contracts. It does not look good at all for Russian exports and the [domestic oil] industry six to eight months from now.”

One key area of marine insurance is liability cover, which covers shipowners for huge accidents such as oil or bunker fuel spills that can incur multibillion-dollar claims. Without such cover, many ports decline entry.

The maritime sector has its own special insurance arrangements through the International Group of P&I Clubs, 13 protection and indemnity insurers, most of which operate from Europe. They provide mutual insurance coverage for 90 per cent of oceangoing tonnage, pooling their risk, and rely on Lloyd’s for reinsurance cover.

Some P&I executives who spoke to the Financial Times said the Iran oil experience would make complying with a Russian ban easier, but others see a Russian ban as adding to an already-crushing compliance workload because of other strictures coming from the conflict.

The EU has proposed a six-month phase-in period for the insurance ban, which could give Russia and interested parties time to sort out alternative cover through less well-developed insurance markets such as India and China, and in Russia itself. Since the conflict began, Moscow has moved to beef up the capacity of its state-owned reinsurer.

In the case of Iran, Tokyo began to offer sovereign guarantees for Japanese vessels carrying Iranian oil. India granted permission for ships to enter its ports covered by certain Iranian underwriters. Iran has its own P&I insurer, Kish, created as western insurers pulled back.

Analysts, however, believe that the state-owned Russian, Indian and Chinese fleets are not large enough to handle all of the country’s oil exports on their own.

Some experts argue that shipping companies looking to move Russian oil could find that insurance capacity outside of the UK and EU is insufficient, while ports may not accept ships covered by arrangements outside of the International Group of P&I Clubs.

Matthew Wright, freight analyst at Kpler, said Russia would struggle to maintain the same level of oil exports when the ban comes in, but added: “There are still plenty of tanker owners who can act under the radar. There’s always loopholes and they will be exploited.”

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Yacht Insurance

Table of Contents

How Does Yacht Insurance Work?

What doesn’t yacht insurance cover, who needs yacht insurance.

Yacht insurance is designed to offer liability and physical damage coverage for boats of 27 feet or more in length. This coverage can apply to incidents resulting in bodily injury or damage to the property of others while the yacht is being operated, and it can also cover certain perils – like fire, theft, vandalism, or wind – that cause damage to the hull, engine, or other attached equipment.

You may also be able to obtain coverage for personal items on board the yacht and for towing after an accident occurs.

Much like car insurance , yacht insurance provides a means to submit claims for damage inflicted upon your boat and any injury or losses inflicted upon third parties. If your policy includes coverage for such incidents, your insurer will offer coverage up to the limitations and provisions stipulated in your policy.

There are two common types of yacht insurance policies, which each dictate how a total loss to the yacht will be settled after a covered peril occurs, subject to the applicable deductible :

• An agreed value policy costs more upfront, but if the yacht is declared a total loss, the insurance company will pay you the value as listed in the policy. This amount is agreed upon between you and the insurer when coverage is selected, and an appraisal or sales receipt may be required as verification. 
• An actual cash value policy considers depreciation and market value, so you'll only receive the worth of the yacht in a total loss settlement. This policy is typically cheaper, but it provides less coverage.

A typical yacht insurance policy's two primary sections are hull insurance and liability insurance .

The hull insurance section of your policy will cover any accidental, physical damage to or loss of your yacht, including its hull, the engine(s), sails, and other attached equipment needed for its operation. Personal property stored on the yacht may also be covered, depending on the specific policy. This coverage will protect both you and the lender if your yacht is financed.

The liability section covers any legal liability you may have to a third party due to the ownership or operation of the yacht, such as for bodily injury, loss of life, or damage to their property.

There may also be coverage for instances other than collision where you cause damage to another yacht. For example, if you fail to yield to a yacht that has the right of way and it subsequently runs into a channel marker to avoid hitting you, you could still be held liable for the damage.

Looking to insure a boat under 27 feet in length or a personal watercraft? Learn about boat owners insurance .

Typically, a yacht insurance policy will not cover regular wear and tear, mold damage, animal or insect damage, or malfunctioning or broken machinery. Coverage for personal property and unattached equipment like fishing gear may also be limited or excluded completely.

When considering yacht insurance, you should speak to your agent and understand what is and isn't covered by the policy.

Obtaining yacht insurance is typically optional, but it may be advisable to protect your boat and other belongings, yourself, and the people sailing with and around you.

Additionally, many marinas require yacht insurance to use a slip or mooring, and you’ll need a policy if you’re financing your yacht purchase to protect your lender’s financial interest .

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Sailing yachts like Mike Lynch's are 'unsinkable bodies', CEO of boat manufacturing firm says

Bayesian superyacht which sank off Italy is an "unsinkable" vessel, Giovanni Costantino, CEO of The Italian Sea Group, said.

By Ashna Hurynag, news correspondent and Eleonora Chiarella, producer

Sunday 25 August 2024 08:48, UK

Vessels like Mike Lynch's stricken superyacht are "unsinkable", according to the chief executive of the firm which makes and sells them.

Giovanni Costantino, CEO of The Italian Sea Group, told Sky News there are no flaws with the design and construction of the Bayesian superyacht which capsized in a storm off the coast of Porticello, Sicily, on Monday.

Five bodies were found by divers on Wednesday - taking the number of confirmed dead to six.

The Italian Sea Group also owns the firm that built British tech tycoon Mr Lynch's Bayesian, and Mr Costantino said the vessels "are the safest in the most absolute sense".

"Being the manufacturer of Perini [boats], I know very well how the boats have always been designed and built," he said.

"And as Perini is a sailing ship... sailing ships are renowned to be the safest ever."

He said their structure and keel made them "unsinkable bodies".

Read more on this story: Why search of superyacht wreck has been so difficult Hero mum 'slept with baby on deck when storm sank yacht'

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Mr Costantino said news of the sinking "put me in a state of sadness on one side and of disbelief on the other".

"This incident sounds like an unbelievable story, both technically and as a fact," he said.

It is understood Italian prosecutors investigating the incident are continuing to hold interviews with the survivors.

On Tuesday they questioned the captain for more than two hours to help reconstruct what happened and provide useful technical details.

Four British inspectors are also in Porticello and have begun a preliminary assessment of events.

It is understood they will look at all relevant aspects of the incident, including the design, stability, and operation of the vessel. They will also examine the effects of the weather conditions experienced.

Keep up with all the latest news from the UK and around the world by following Sky News

Twenty-two people were on board the vessel, 15 of whom were rescued - including Briton Charlotte Golunski and her one-year-old daughter Sofia.

Divers will resume efforts on Thursday morning to bring ashore a body they found earlier. One more person remains missing.

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