Chinese Built Vessels Produce More Frequent Insurance Claims

The Nordic Association of Marine Insurers (Cefor) has highlighted in their 2015 Annual Report an analysis of their data which shows that vessels built in Chinese yards exhibit a much higher claims frequency than vessels built in Japan or South Korea. Cefor found that claims frequency was 89% higher for vessels built in China and elsewhere in the world, compared to vessels built in Japan or South Korea. They noted that frequency is particularly high in machinery claims.

The Cefor analysis focused on the tanker, bulk, and container segments. It will be interesting to see how the trends develop and we hope the 2016 report will include an update as market share of Chinese built vessels increases.

Also noteworthy is the fact that China is a rising country for the production of super yachts. Chinese production of yachts is still quite small when compared to their US and European competitors but we think their time will come. To do so though they will have to overcome the “Made in China” stigma and the Cefor report, while not focused on yachts, doesn’t help their case.

The Cefor annual report can be found at www.cefor.no.