MARINE insurers have been told that they will need to strengthen their resilience and contingency-based approach to business if they are to survive an increasingly uncertain and volatile landscape where disruption of supply chains is becoming a norm.

“In a world where established assumptions are being continuously challenged and new technological advances promise to revolutionise industries, standing still is not an option,” said Ilias Tsakiris, chairman of the Ocean Hull Committee of the International Union of Marine Insurance.

Speaking at Marine Insurance London 2024, Tsakiris told an industry audience that the sector should “shore up its resilience and embrace innovation in the face of a host of new and developing risks”.

The coronavirus pandemic was cited as a wake-up call to illustrate that storms could arrive “out of nowhere”.

But this had been reinforced by Russia’s invasion of Ukraine and other ongoing geopolitical upheavals.

Tsakiris said that a transport and logistics sector that had immersed itself in a just-in-time mentality should now attach greater importance to “just-in-case” strategies.

“It's about ensuring that when the unexpected happens, we’re not left out in the cold, wondering where we went wrong,” he said.

Traditional maritime trade routes were being disrupted and supply chains “will face challenges bigger than the ones faced during the pandemic,” he told the conference.

“The bottom line is that risks are abundant, and the transformation to the just-in-case model is the only option for companies, including insurers, seeking to operate in this environment.”

Supply chain management practices are already adapting with many major manufacturers friendly-shoring, near-shoring or re-shoring operations — strategies that posed “significant implications” for seaborne transportation, he argued.

At the same time, hull underwriters could not ignore the industry’s energy transition as shipping strives to meet the target of emitting net zero greenhouse gases by 2050.

“There is a need for innovative infrastructure and regulatory incentives to facilitate this transition that will have a significant impact on operational logistics and cost structures within the industry,” he stated.

Tsakiris, who is chief executive of Hellenic Hull Management and of American Steamship Owners Marine Insurance Company (Europe), identified a plethora of different risk areas facing insurers.

He said that the path forward for the sector relied on adopting “a holistic approach integrating technological adeptness, client-centric innovation, a proactive policy towards emerging needs and a commitment to sustainability.

“In addition, the value of continuous learning, adaptability and co-operation cannot be overstated,” he said.

“By embracing this comprehensive approach, marine underwriters can navigate the complexities of the modern world, delivering value that is expected by their clients while steering towards a sustainable and resilient future.”