BAKU, Azerbaijan, September
24. Surety Marine, an international insurance
company specializing in marine and financial risks, is evaluating
insurance opportunities along the Middle Corridor, Managing
Director of Surety Marine, Kirill Patyrykin, told Trend in an exclusive
interview.


"Azerbaijan offers interesting opportunities through its
position on the Caspian Sea and its role in the Middle Corridor,
which connects Asian and European markets through a combination of
maritime and overland transport.


As businesses consider alternative routes, we see potential for
cooperation with local insurers, brokers, shipowners and logistics
operators on insurance arrangements tailored to these journeys.


Multimodal transport requires careful attention to cargo
handling, temporary storage, transfers between carriers and the
continuity of cover across different stages of transit.


The opportunity is to develop insurance that reflects how these
routes actually operate. Their growth will depend on
infrastructure, service reliability and commercial viability,
alongside the demand for greater diversification in international
trade," he said.


Impact of changing situation in Strait of Hormuz
on international marine insurance market


The managing director assessed the impact of the changing
situation in the Strait of Hormuz on the international marine
insurance market.


"The impact has been profound. I remember war and strike rates
of around 0.1–0.2% when I first entered the industry. Today, rates
for high-risk exposures can exceed 20% per annum. That gives a
sense of how dramatically the perception of risk has changed.


The escalation around the Strait of Hormuz has affected both
premiums and the terms on which insurers are willing to accept
individual voyages. Uncertainty about the scale and duration of the
conflict can fundamentally change the economics of a voyage.


In my view, this reflects a deeper shift in how the market
perceives geopolitical risk. A disruption in one strategic waterway
can affect vessels, cargoes, energy supplies and financing
simultaneously. Its consequences extend well beyond the insurance
sector," he explained.


Key factors influencing determination of
insurance premiums for vessel operating on specific
route


Patyrykin also discussed the key factors that influence the
determination of insurance premiums for a vessel operating on a
specific route. According to him, the starting point is the
vessel’s actual exposure: where it will sail, how long it will
remain in a sensitive area, which ports it will call at, and what
cargo it will carry.


“The Joint War Committee’s Listed Areas are an important
reference for assessing war risks. However, the committee does not
set premiums; rates are negotiated individually between
underwriters and brokers.


Underwriters also consider the vessel’s flag, ownership, age,
condition, claims history and management standards, alongside crew
experience and security preparedness. AIS voyage history, sanctions
screening and verified security intelligence help establish the
wider picture.


Threats such as drone attacks and interference with navigation
systems require particular attention. Ultimately, the premium
reflects the combination of these factors, the cover requested and
the insurer’s assessment of the voyage,” he stressed.


The company official said that Surety Marine differs from
traditional insurance companies in its approach to risk assessment
and underwriting.


“Our approach centres on specialist underwriting and a detailed
understanding of each client’s operations.


Marine insurance encompasses several business models. Mutual
P&I clubs, for example, provide liability protection through
collective risk-sharing, supported by the International Group’s
pooling and reinsurance arrangements. That structure plays an
important role in the industry.


At Surety Marine, our focus is on complex and specialist risks
that require an individual assessment. We combine technical
underwriting with analysis of the vessel’s operations, trading
patterns and changing risk environment.


Clients are becoming more experienced and demanding in their
assessment of insurance. They expect clear reasoning behind
underwriting decisions, a practical understanding of their business
and certainty about the scope of cover. Our approach is designed to
respond to those expectations.


Marine insurance has always extended beyond physical hull
damage, particularly through liability and cargo cover. What has
become more prominent is the interaction between physical,
operational and geopolitical risks.







A vessel may remain undamaged while its voyage becomes
substantially more difficult or expensive. Rerouting, prolonged
detention, port restrictions and interference with navigation
systems can all change the operating environment.


Longer voyages can also affect fuel consumption, maintenance
schedules and crew workload. For an underwriter, these changes
matter because they alter the circumstances in which the vessel
operates.


The assessment therefore needs to consider the vessel within its
wider trading environment. It must also distinguish clearly between
the risks a business faces and the losses its insurance policy
actually covers," he noted.


Gaps in global trade insurance model exposed by
risks in Strait of Hormuz, Red Sea, and other strategic shipping
routes


The Director General also discussed the gaps in the global trade
insurance model revealed by risks emerging in recent years in the
Strait of Hormuz, the Red Sea, and other strategic shipping
routes.


"In my view, the most significant gap concerns the financial
consequences of disruption without insured physical damage.


A shipowner or cargo owner may face substantial additional costs
because a route becomes unsafe or a voyage is delayed. Whether
those costs are recoverable depends on the cover purchased and the
specific policy wording. Businesses can therefore discover a
considerable difference between their commercial exposure and their
insurance protection.


Another challenge is the concentration of risk. A single
regional crisis can affect many vessels and cargoes at once,
placing pressure on underwriting capacity and reinsurance.


These events underline the need for clearer coverage
expectations, better assessment of interconnected exposures and
earlier discussions between clients, brokers and insurers when
trading conditions change," he pointed out.


Discussing how cargo insurance risk assessment differs from hull
insurance, Patyrykin said that cargo insurance focuses primarily on
the cargo itself and its susceptibility to loss or damage during
transit.


"Cargo underwriting begins with the goods and their
susceptibility to loss or damage during transit. We look at their
nature and value, packaging, stowage, handling requirements,
temperature sensitivity and the proposed journey, including storage
and transshipment.


Transit duration matters, particularly for perishable or
sensitive goods. However, standard cargo insurance should not be
understood as protection against every financial consequence of
late delivery. The Institute Cargo Clauses generally exclude loss,
damage or expense caused by delay, subject to their wording.


Hull and machinery underwriting focuses on the vessel itself:
its construction, age, class, machinery condition, maintenance,
management and operating history. The assessment considers the
potential for damage, the cost of repairs and recovery, and the
possibility of a total loss,” he said.


Expectations regarding key changes in
international marine insurance market over next 2–3
years


In conclusion, the managing director shared expectations
regarding key changes in the international marine insurance market
over the next 2–3 years.


"Over the next 2–3 years, I expect artificial intelligence,
including large language models, to become more widely integrated
into marine underwriting workflows. Document review, the
organisation of risk information and the identification of
inconsistencies are areas where these tools could make a
substantial contribution.


I also expect greater use of satellite information, vessel
tracking and onboard sensor data to support voyage assessment, more
responsive pricing and continuous compliance monitoring.


These developments will place greater importance on data quality
and the ability to explain how information has influenced a
decision. Human responsibility will remain essential.


More intrusive monitoring, including onboard video, may also be
explored. My view is that any such use should have a clear
operational purpose and proportionate safeguards for privacy.
Technology should strengthen underwriting judgement and safety
while preserving trust," concluded Patyrykin.