Shipping losses down but industry faces significant threats

25 August 2021

The shipping industry saw losses of large vessels at a record low in 2020 but had to deal with the impact of COVID-19, the lessons of the Ever Given Suez Canal grounding, piracy and the growing threat of cyber-attacks.


The Suez Canal blockage by the Ever Given containership impacted on world trade, revealing the fragility of supply chains. According to Lloyds List, the litigation triggered by the grounding potentially involved 20,000 teu and up to 20 cargo interests per container.


Of growing concern to the shipping industry is the risk of cyber-attack with all four of the world’s largest shipping companies targeted since 2017. Ransomware, USB malware, and worms have all been spotted aboard a ship's IT systems.


According to security services provider BlueVoyant, shipping and logistics firms in 2020 experienced three times as many ransomware attacks last year as in 2019. A spike in malware, ransomware, and phishing emails during the pandemic helped drive a 400% increase in attempted cyberattacks against shipping companies through the first months of 2020.


Robust risk management coupled with a comprehensive insurance programme, provides the ultimate safety net against the uncertain consequences of many of the emerging exposures

A leading shipping industry report has also highlighted the rising danger of piracy in the Gulf of Guinea where 130 crew were kidnapped last year in 22 incidents. The Safety & Shipping Review 2021 also reported that the 49 large ships lost at sea last year is one less than 2020.


A third of the ship losses occurred in the Southern China, Indochina, Indonesia and Philippines areas while the Eastern Mediterranean, Black Sea and Arabian Gulf saw significant increases in loss activity.


The report also noted that the number of total shipping incidents declined by 4% from 2,818 to 2,703 in 2020 with the British Isles, North Sea, English Channel and Bay of Biscay registering the highest number of reported incidents (579) - slightly down year on year. Covid-19-related delays at ports and shipping capacity management problems led to congestion at peak times and a shortage of empty containers


The European Maritime Safety Agency have recently produced a report on the impact of COVID-19 on shipping by analysing ship calls at EU ports. It found that the number of ships calls at EU ports declined by 10% in the 2020 compared to 2019.


W Denis group provides a range of specialist insurance services to shipping companies, ports, freight forwarders and cargo handling terminals. For more information, please contact Vida Jarasiunaite at vida.jarasiunaite@wdenis.eu

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