Global Shipping Losses Down in 2014, But New Risks Could be Emerging

Global shipping losses for 2014 may be down once again, but mega ships and cyber attacks are emerging as risks and pose a threat to the maritime sector. With 75 total losses reported worldwide in 2014, it makes 2014 the safest year to ship in 10 years. The loss numbers have even declined by 50% since 2005! The United States eastern seaboard region did not register a total loss for the second consecutive year, and the North American west coast region also did not see a total loss in 2014.

Despite the lower downward trend in losses, among the new risks is the increasing size of container ships and floating offshore facilities. With ship sizes increasing there will only be a limited number of deep-water ports that can operate such vessels, leading to an increased concentration of risk; worldwide shortage of qualified seaman; and salvage and removal challenges.

There are also cyber risk concerns. AGCS reports that a cyber attack targeting technology on board, in particular electronic navigation systems, could lead to a total loss or involve several vessels from one company. Another scenario might be that cyber criminals could target a major port, closing terminals or interfering with containers or confidential data. Such attacks could also result in significant business interruption costs, notwithstanding liability or reputational losses.