Piracy, a practice once thought long-dead is, in fact, alive and well today. Ongoing economic trauma has produced desperation in a number of nations throughout the world. People displaced by financial calamity have been flocking to the African country of Somalia, where they have been joining pirate bands. Somalia is an infamously unstable state which has served as a port of home for modern-day pirates that prey on shipments throughout the Indian Ocean. Pirates have, of course, run afoul of man law enforcement and military organizations, but their greatest enemy may be the insurance industry.
The UK’s maritime insurance industry has been most affected by the acts of pirates. The nation’s insurers have a long history of providing coverage to commercial shipping vessels that traverse the Indian Ocean. In recent years, these vessels have been targeted by pirates who have made away with millions of dollars worth of goods with little to no resistance. The Catlin Group, a subsidiary of Lloyd’s of London, is drafting new insurance policies that are designed to target acts of piracy directly.
Catlin’s new policies will include ransom and legal fee reimbursement. The policies will also cover the costs of several defense organizations, most of whom are British, as well as other expenses, such as communications fees and salary cost. Catlin is also working with several British law firms to take actions against pirates.