Tokio Marine Kiln (TMK), an insurer in special risks underwriting, and Marsh, an insurance broker and risk management expert, have jointly announced the launch of an exclusive insurance facility for ports and terminals, providing protection against business interruptions stemming from trade disruptions.
The new offering, described as the first of its kind available on the market, was developed through the collaboration of Marsh’s Marine Cargo & Logistics specialists and Tokio Marine Kiln.
Louise Nevill, CEO, UK Marine, Marsh Specialty, commented: “Business interruption events stemming from geopolitics, trade disruption and weather-related incidents are increasing in their frequency and severity around the world, which is resulting in debilitating consequences for businesses involved in international trade.”
Nevill continued: “This new facility offers our port and terminal clients a rapidly available layer of cover to protect their operations and facilitate an expeditious resumption of normal operations when these events occur.”
Led by Ed Parker, TMK’s Head of Special Risks, this coverage is accessible to Marsh clients worldwide. It provides up to $50 million in capacity for business interruption losses related to trade disruptions, which could be caused by geopolitical events, severe weather, or other factors outside the port’s control.
This announcement builds upon the launch of Marsh’s $50 million port blockage insurance, which safeguards clients from revenue losses due to incidents like vessels sinking, waterway closures, or natural catastrophes.
In recent years, global trade has faced significant challenges due to disruptions such as the crisis in the Red Sea, the conflict in Ukraine, and tensions in the Taiwan Straits.
These events have caused vessels to divert from traditional routes, creating substantial delays. For example, in early 2024, trade through the Suez Canal fell by over 50%, greatly impacting ports that depend on this critical passage. Additionally, in March 2024, the collapse of the Francis Scott Key Bridge in Baltimore severely disrupted trade.
Traditionally, insurance for ports, terminals, and other cargo-handling operations only covers business interruptions due to physical damage or when access is physically blocked.
This has left ports vulnerable to financial losses from uncontrollable external events. The new facility from TMK and Marsh addresses this gap, allowing ports to secure coverage for trade disruptions caused by wider external events.
This includes diversions of ships, refusal to call at specific ports, or impacts from blockages—whether by sea or land. The policy also extends to cover losses from increasingly volatile weather patterns and heightened risks from hurricane and typhoon seasons, which continue to elevate the chances of blocked port access.
Ed Parker, Head of Special Risks at Tokio Marine Kiln, added: “Recent geopolitical turmoil has exposed a clear gap in the standard cover available to ports and other cargo facilities. The threat posed by conflict has rendered many established routes impassable. Trade has been disrupted globally and the financial impact on many operators has been immense.
This is compounded by the ever-present threat from blockages, with recent events in the Suez Canal and the collapse of the Francis Scott Key Bridge in Baltimore emphasising the scale of the potential impacts of these events beyond the control of port operators front of mind.
We are delighted to work with Marsh to bring this product to market. Developing innovative solutions which reflect changing risks and which respond to client demand is core to the Tokio Marine Kiln approach and we look forward to working with Marsh and port businesses around the world to provide a much needed solution to the threat posed by trade disruption.”
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