The insurer says it has made the move to address a lack of capacity in the marine cargo market
Chubb has launched a new Lloyd’s of London consortium that has been designed to provide insurance coverage for risks associated with the transit and storage of lithium batteries.
A statement released yesterday (14 September 2023) said the consortium will provide a one-stop solution, with limits up to $50m (£40.2m) for risk types associated with lithium batteries.
This includes transit, stock throughput, standalone stock and warehouse legal liability.
It will be led by Chubb Global Markets (CGM), the company’s London market wholesale and specialty business including its Lloyd’s platform, and supported by 11 other Lloyd’s syndicates.
Rob Wilson, chief underwriting officer for Chubb Global Markets, said: “We’re delighted to lead the creation of this battery consortium with the support of the Lloyd’s market, utilising our in-house risk management capabilities to ensure its viability.
”The work involved in managing lithium battery risks is extensive and brokers can now use this facility to gain access to capacity in this new risk area.
”The consortium provides brokers and insureds with a single port of call to bind these risks, helping to shore up the lithium battery supply chain as demand continues to grow.”
Capacity
Chubb said the consortium was created to address a lack of capacity in the marine cargo market for providing lithium battery transit and stock insurance.
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According to Park Lodge International, lithium-ion batteries can set alight by overheating, penetration or over-charging.
Earlier this year (31 May 2023), Allianz Global Corporate Specialty (AGCS) highlighted that an analysis of close to 250,000 marine insurance industry claims showed that fire was the most expensive cause of loss, accounting for 18% of the value of all claims analysed in 2022.
It also reported that the British Isles saw 679 cases of shipping casualties or incidents out of 3,032 globally last year.
Machinery damage or failure accounted for 1,478 incidents worldwide – of these incidents, fire was one of the leading causes as 209 were reported, equating to a 17% increase year-on-year.
Matt Hardy, leader of Chubb Climate+ for Chubb Overseas General, said: “The lithium battery industry is growing at a rapid rate and many businesses involved in moving and storing these batteries are increasingly in need of an experienced and reliable insurance partner and solution to support the ramp-up in production.
”The creation of a consortium dedicated to underwriting these risks aligns firmly with our commitment to harnessing our underwriting and risk engineering capabilities to support the transition to a low-carbon economy.”
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