Canada’s marine insurance market is entering a new era – one where traditional cargo and liability coverage is no longer sufficient. A surge in cyberattacks, labour disruptions, geopolitical instability, and port system failures is driving a shift in how shipping firms and port authorities approach risk management.
According to Hussein El Khatib (pictured), head of marine at Zurich Canada, this evolving threat landscape is prompting clients to embrace specialized coverages that were once considered niche. Today, they’re fast becoming foundational elements of marine risk strategies.
The risks facing Canadian port operators and maritime logistics firms have multiplied in recent years. From ransomware attacks on port infrastructure to prolonged delays caused by political unrest, businesses are looking for protection that goes beyond the scope of traditional marine policies, El Khatib said.
“Business interruption tied to delays, port closures, or strikes is getting more attention. Cyber protection has become critical as ransomware continues to target port systems and freight operators. Political risk is also back on the radar,” he told Insurance Business.
As trade routes shift in response to conflict, tariffs, or diplomatic tensions, firms are increasingly seeking protection against sudden access loss to key markets, breach of contract, or regulatory disruptions. These specialty policies help businesses navigate uncertainty while continuing to expand into volatile or emerging regions.
“Specialty products are no longer niche,” El Khatib said. “They’re becoming core components of marine risk strategies.”
Looking ahead, El Khatib sees a transformation on the horizon for the marine and port sectors. Risk managers and underwriters, he said, will need to adapt to a more complex, tech-driven, and politically dynamic marketplace.
One of the most significant developments will be the realignment of global trade. As countries prioritize domestic manufacturing and supply chain sovereignty, existing routes may become obsolete. This shift could introduce new logistics chokepoints and expose previously overlooked or underinsured parts of the shipping chain to risk.
At the same time, climate-related threats such as storm surge and sea level rise are forcing coastal ports to make substantial long-term investments in resilient infrastructure. Insurers, in turn, must consider these upgrades when evaluating risk and structuring policies.
Technology will also play a central role. Digital risk modeling, AI-powered analytics, real-time cargo tracking, and smart contracts are expected to become standard inputs in underwriting decisions, improving both accuracy and efficiency.
Meanwhile, as shipping firms expand inland through port-centric logistics strategies, their exposure footprint is also growing. With more end-to-end control over goods movement, carriers are taking on greater liability – adding new layers of complexity to their coverage needs.
Finally, inflation and geopolitical volatility are prompting insurers to pay closer attention to cargo valuation, accumulation risk, and transparency. Ensuring accurate disclosure and avoiding underinsurance will be critical as clients seek more reliable protection in an increasingly unpredictable environment.
The rise in demand for specialty coverages comes against a backdrop of intensifying and evolving risks for Canada’s shipping sector. El Khatib noted that climate change is among the most urgent forces reshaping port operations. Stronger storms, shifting ice conditions, and sea level rise are not only threatening infrastructure but also disrupting vessel schedules and cargo delivery expectations.
At the same time, geopolitical instability and global trade realignment are redrawing shipping routes, often introducing new chokepoints and compliance risks that marine insurers must monitor closely. Labour disruptions, crew shortages, and tighter environmental regulations are adding further layers of complexity.
“We are also seeing a rise in theft and damage.” El Khatib said. “North American cargo theft jumped 27% in 2024, fuelled by economic pressure and emerging trade routes that have yet to be fully secured. Criminal networks are targeting high-value or sensitive cargo where logistics gaps are easiest to exploit.”
As risks grow more complex, so too does the underwriting process. According to El Khatib, the post-pandemic era has ushered in a far more data-driven approach to marine and cargo insurance. Insurers, he adds, are increasingly turning to real-time tracking, analytics, and AI tools to assess exposures, evaluate vessel and cargo behavior, and fine-tune pricing.
Stricter underwriting standards are becoming the norm, especially in areas exposed to climate extremes or geopolitical volatility. Policies are being updated with tighter exclusions and higher deductibles in these regions, while regulatory compliance, environmental sustainability, and sanctions screening are now key factors in underwriting decisions.
Many shipping firms and port authorities are taking proactive steps to strengthen their resilience. According to El Khatib, these efforts increasingly focus on long-term, integrated risk planning that addresses both operational continuity and infrastructure vulnerability.
“These are no longer optional improvements they are now business essentials,” he said.
