The marine insurance industry is seeing booming growth in the Canadian marketplace – and with growth comes competition. But the biggest threat in the space isn’t coming from other insurers, but logistics companies trying to move in on the action, says a marine specialist.
“Some of the more independent companies – like logistics companies – are trying to see if they can provide insurance,” says Patrick Barco, National Product Leader of Marine at Burns & Wilcox Canada. “What they do, apart from providing a service - in other words, doing the crate, the handling and the customs - they’re trying to provide insurance as well. In other countries, they actually get a license to write insurance, so that would be a trend, too.”
Barco, who has over 35 years in the insurance industry – over 20 of which spent specializing in marine coverage at various MGAs – says the industry also suffers from those who lump it in with other coverages, rather than treating it as a stand-alone specialty.
“There’s a threat from the property and casualty market that tries to say, ‘Oh, marine can be done in C&P, why not just throw it in, and call it just one insurance?’ But it’s not as easy as that – marine does require a vast amount of expertise. That’s why you see there are very few companies that write marine insurance. Those that do write it know what their specialty is.”
Intimate experience of the market is a must says Barco, who spent the formative years of his career working in the marine space in Dubai.
“Experience is a very important part because you need to know the market you’re working with. One needs not only underwrite the risk, one needs to be competitive as well in order to write the risk,” he says. “Having said that, if you do not know what you are insuring, or do not know what the market really is quoting, you don’t stand a chance of winning that business or writing that insurance.”
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