The shipping industry saw its safest year in a decade in 2015, according to a new report from Allianz Global Corporate & Specialty (AGCS), with 85 total losses reported worldwide last year, down from 88 in 2014 and well below the 10-year average of 123.
Total losses are down 45 percent since 2006, a change AGCS said is driven by an increasingly robust safety environment and self-regulation.
Cargo and fishing vessels accounted for more than 60 percent of ships lost globally, and the most common cause of total losses was foundering (sinking), responsible for almost 75 percent of losses, AGCS said in the report.
In all, there were 2,687 reported shipping incidents in 2015, down 4 percent from 2014.
Among the top risks for shipping in 2015:
- Piracy attacks, which increased slightly to 246 incidents last year, about 60 percent of which occurred in the South East Asia region. AGCS warned that there are also indications that pirates may be using cyber security holes to target specific cargoes.
- Extreme weather events, which are becoming more commonplace, increasing the risk of supply-chain disruption. AGCS said weather was a factor for three of the five largest vessels lost last year, including the El Faro, one of the worst U.S. commercial maritime disasters in decades.
- Cargo-carrying capacity, which has increased by 70 percent over the last 10 years for the largest vessels, allowing some ships to hold 19,000-plus containers. AGCS said this “mega ship” trend means the industry needs to be prepared for a $1 billion-plus total loss scenario.
For a more detailed look at the shipping industry in 2015, see the full report by AGCS: Safety and Shipping Review 2016.
Source: Allianz Global Corporate & Specialty
This article first appeared in Carrier Management, Insurance Journal’s sister publication.