IIFA SeminarThursday 21st October 2010

Dublin

Marine Insurance

• Dynamics and challenges in the (insurance) market

– Trade & Insurance markets

• Trade Facilitate & Starr Marine partnership

• On line Trade Facilitate applications

Global Marine Insurance Market

29%

51%

7%

13%

Global Hull

Transport/Cargo

Marine Liability

Off Shore/Energy

Total Reported: 22,9billion USD

Total Estimated: 23,6billion USD

Source: IUMI 2010

Dynamics of the insurance market

• 21st Century

• Technology and global trade

• Technology and Insurers

– An acronym?

– Opportunities

• Globalisation

• Trade

• Services

– FOS – Freedom of Services

– Lloyd’s Franchise board

Nature of the marine insurance market

• ‘To follow’ principle

– Trade

– Needs

• Inherent part of many trade transactions:

– Contract of

• Sale

• Carriage/transport

• Credit (LC/structured/...)

• Insurance

– INCOTERMS

• Innovation

Nature of the marine insurance market

• Sensitive

– Trade shocks

• Seaborn trade contracted -4,5% in 2009

• Container shipping -9,4% in 2009

– Freight rates

• Baltic Tanker freight index

• Dry cargo freight rate index

Source UNCTAD

Challenges of the market

• Cargo:

– Reduction in insured values

– Upwards adjustments of 07/08 claims reserves

– Profitability

• Hull

– Loss for 14 consecutive years

• Off Shore Energy

– Volatile

Challenges of the market

• Regulatory

• Compliance

– Trade restrictions

– Sanction regimes

• Solvency II

• Transparency

• Performance & efficiency

Solvency II

• Revised solvency regime for EU (re)insurers

• Implementation of solvency requirements

– Improved reflection of the risk

– Consistent supervisory system EU

• Requirements for

– Capital adequacy & risk management

– Reduction likelihood of failing (re)insurer

Trade Facilitate & Starr Marine partnership

How to manage the challenges?

• Innovation

– ‘Must have’

• Service Industry = facilitating role

• Insurance is never a client’s core business

• Define values/benefits & key differentiators

– Time

– Accuracy and efficiency

– Cost saving

– Performance

– Growth

Trade Facilitate & Starr Marine partnership

• How?

– Smart

• Use of technology

• Improved service

• Simple

– Quick win

– Strong partners

• Field Experience

• Standing reputation

• Thinking ahead

– People

• Advise and assist

– From constraints to opportunities

Insurance application

• Why Cargo insurance?

– Capital at risk

– Unforeseen element

– Ultimate requirement

• Title/holder of the insurance certificate

• No liability constraints

– Limitation of (carriers) liabilities

• Hague visby / Rotterdam

• Warshau

– Short tail

• Financial burden for undamaged cargo:

– GA contributions

Insurance application

• Accredited Members

• On line

– A few clicks away

• Transactional or Structured

– Personal designed program

• Easy acces to highest security

– Lloyds A+

• Instant delivery

– Pdf secured and unique certificate

– Electronic negotiable document

• On line claims notification

• Immediate acces to local surveyor

Conclusion

• Marine Insurance not always on the shopping list

• Differentiator

• Premium service

• Financial security

• Keep it simple

Company information

Starr Underwriting Agencies, LLC

• Starr Underwriting Agencies, LLC (SUAL) is a wholly owned subsidiary of CV Starr and the parent company of the Starr Underwriting Agencies

• The Starr Underwriting Agencies:

– C.V. Starr & Co. (C.V. Starr)

– Starr Aviation Agency, Inc. (Starr Aviation)

– Starr Global Accident & Health Insurance Agency, LLC (Starr Global)

– Starr Marine Agency, Inc. (Starr Marine)

– Starr Specialty Lines Insurance Agency, LLC (Starr Specialty)

– Starr Technical Risk Agency, Inc. (Starr Tech)

Starr Underwriting Agencies, LLC

• Internationally, the Starr Underwriting Agencies operate as divisions of:

– Starr Underwriting Agents Limited

– Starr Underwriting Agents (Asia) Limited

• The Starr Underwriting Agencies are projecting to produce approximately $2.1b in gross premiums in 2009 and expect to employ more than 700 people globally

• The Starr Underwriting Agencies have decades of experience in managing complex risks

The Starr Underwriting Agencies Distribution Network Locations

Starr Marine

• Formerly known as the American International Marine Agency.

– Founded in 1945;

– Worldwide underwriter of Ocean Marine business and exclusive Managing General Agent (MGA) for the AIG group of Companies for over 60 years.

• In 2006 our agreement with AIG ended and the entire underwriting, accounting, loss control and systems team at AIMA moved as one to what is now Starr Marine Agency Inc..

• In July of 2006 we announced the formation of our new partnership with the Berkshire Hathaway Group of Companies as their MGA for Ocean marine business.

• In October of 2006 we opened our first office overseas and Syndicate 1919 began writing business at Lloyds.

Starr Marine (continued)

• In November of 2006 American International Marine Agency announced our name change to Starr Marine Agency, Inc..

• In 2007 we opened an office in Hong Kong and further expanded into Beijing and Shanghai.

• In 2008 we opened offices in Belgium, The Netherlands, Italy and Germany and we have plans for further expansion in the near future.

• We continue to write, as we have throughout our history, a full compliment of Ocean Marine Coverage’s - Cargo, Hull / P&I and a variety of primary & excess liability covers.

• Agency services also include claims management, subrogation, loss control & accounting.