Learn why a potentially quieter hurricane season can still bring major property risk – and discover the advantages of working with a trusted expert broker at Lloyd’s.

The 2026 Atlantic hurricane season may be forecast to be quieter than average, but that does not mean property owners, insurers, brokers and other insurance market participants can afford to relax. Seasonal forecasts measure overall hurricane activity – they cannot tell you whether one major storm will make landfall in a heavily exposed area. For North American and Caribbean property portfolios, the priority remains understanding your exposures, securing appropriate coverage and capacity, and preparing well before a storm is approaching. Working with an experienced Lloyd’s broker such as Costero Brokers can help you navigate the changing market and build protection around the risks you actually face.

Why hurricane season matters to the property insurance market

The Atlantic hurricane season officially runs from 1 June to 30 November. Every year, it creates significant uncertainty for property owners and the global insurance and reinsurance markets, particularly across the Caribbean, Florida, the Gulf Coast and the eastern United States.

The impact of a major hurricane can extend far beyond physical damage from extreme winds. Storm surge, flooding and interruption to power, transport and communications can create substantial knock-on losses, while businesses may face extended closures and disruption to operations, customers and supply chains.

For insurers and reinsurers, major hurricanes can also affect catastrophe capacity, underwriting appetite and pricing. A significant landfall in a highly insured region can change market sentiment rapidly – making the difference between a relatively benign year for the insurance industry and one defined by major catastrophe losses.

Recent hurricanes show the scale of potential losses

Recent years provide a reminder of how quickly hurricane losses can accumulate. Natural catastrophes caused an estimated USD $140 billion of insured losses globally in 2024, with Hurricanes Helene and Milton among the year’s costliest disasters. (Source: Reuters)

The Caribbean was then hit by Hurricane Melissa in 2025. The Category 5 hurricane made a devastating landfall in Jamaica, with estimated insured losses of between USD $2.2 billion and $4.2 billion. (Source: Reuters)

What does the 2026 hurricane forecast tell us?

In its May outlook, the US National Oceanic and Atmospheric Administration (NOAA) gives the 2026 Atlantic hurricane season a 55% probability of being below normal, compared with a 35% probability of a near-normal season and just a 10% probability of an above-normal season.

NOAA forecasts between 8 and 14 named storms, of which 3 to 6 could become hurricanes and 1 to 3 could become major hurricanes. By comparison, an average season has 14 named storms, seven hurricanes and three major hurricanes. (Source: NOAA)

A key factor in the quieter forecast is El Niño – the warm phase of a recurring climate pattern involving unusually warm surface waters in the central and eastern equatorial Pacific, which can influence weather patterns worldwide. NOAA confirmed El Niño had developed in June and was expected to strengthen. El Niño typically increases upper-level winds and vertical wind shear across the tropical Atlantic, which can disrupt and suppress hurricane development. (Source: NOAA)

The outlook has become quieter still as the season has progressed. A separate July update from Colorado State University (CSU) reduced its own forecast to nine named storms, four hurricanes and one major hurricane, as confidence increased in a strengthening El Niño. (Source: Houston Chronicle)

But seasonal forecasts need to be put in context. NOAA specifically stresses that its outlook only predicts overall seasonal activity. As NOAA’s National Weather Service Director Ken Graham emphasises, it only takes one storm to make for a very bad season. (Source: NOAA)

How to protect property portfolios this hurricane season

Whether you are a broker, insurer or risk manager, hurricane season is a good time to look beyond the headline forecast and review how individual exposures could perform if the wrong storm takes the wrong track.

Important priorities include:

• Review your exposure data and valuations. Make sure property values, replacement costs, business interruption exposures and statements of values are accurate and current.
• Understand geographical concentrations. Consider where accumulations exist across Florida, Gulf Coast states, the Carolinas and the Caribbean, and how a single event could affect multiple insured locations.
• Check limits, deductibles and coverage. Review whether limits remain adequate and understand how named-storm or windstorm deductibles, flood and storm-surge exclusions or sublimits, and any separate flood cover could respond.
• Consider your programme structure. If your portfolio and exposures have evolved, is there a need for new excess layers, quota-share participants or parametric protections?
• Prepare for claims before they happen. Clear documentation, business continuity planning and established communications can make an important difference when properties are damaged and rapid decisions are required.
• Avoid leaving placement decisions until a storm is approaching. Once hurricane season is under way – and particularly as peak months approach – appetite can change quickly. Starting conversations early gives your broker more time to explore markets, negotiate capacity and consider alternative structures.

The key is not to react to a quieter seasonal forecast by assuming you need less protection. Instead, use the opportunity to test whether your insurance programme still reflects your actual exposures and risk tolerance.

Why Lloyd’s remains a natural market for hurricane-exposed property

North American and Caribbean catastrophe risks often require significant capacity, specialist underwriting and flexible programme structures. That makes Lloyd’s and the wider London insurance market particularly relevant.

Lloyd’s brings together specialist syndicates with different risk appetites and underwriting expertise. Its broker-led market enables risks to be discussed directly with underwriters and, where appropriate, capacity to be assembled across multiple syndicates or underwriters, rather than relying on a one-size-fits-all solution. (Source: Lloyd’s)

Lloyd’s also plays a significant role in the US excess and surplus lines market, which has become increasingly important for catastrophe-exposed properties where conventional admitted-market capacity may be restricted. Reuters reported that Lloyd’s held the largest share of the overall US E&S market in 2023, while property business from catastrophe-prone states has been an important driver of growth. (Source: Reuters)

But access to Lloyd’s is only part of the answer. The challenge is knowing which markets to approach, how to present the risk and how to structure a placement that balances coverage, price, capacity and long-term reliability.

Getting more from Lloyd’s than access to capacity

In an uncertain hurricane season, you need a broker who will engage with the detail of your risk and help you make informed decisions – not simply feed information into a platform and wait for a response.

A trusted Lloyd’s broker can help you understand changing market appetite, identify suitable underwriters, communicate the strengths of your portfolio and explore alternative options when straightforward capacity is unavailable. That human judgement becomes particularly valuable when market conditions change quickly following a major catastrophe.

Costero Brokers specialises in property insurance with a particular focus on North American and Caribbean risks. We work with retailers, wholesalers and risk managers to access markets in London, Europe and other global insurance hubs, placing risks through the open market and bespoke facilities while maintaining regular communication throughout the process.

Be prepared for the hurricane season

A quieter hurricane forecast may be welcome news. But when one storm can still transform an entire season, preparation and informed insurance decisions remain essential.

To learn more about protecting your property portfolio and discuss your insurance challenges, get in touch with Costero Brokers and speak to Alex Bottomley, head of our property insurance team.

Discover how working with an independent Lloyd’s broker like Costero brings you market expertise plus nimble service delivery.

For insurers, brokers, Managing General Agents (MGAs) and InsurTech businesses worldwide, accessing the London insurance market can open the door to specialist expertise, substantial capacity and innovative solutions for complex risks. Yet market access alone is not enough. You also need a broking partner that understands your business, responds quickly and can adapt when a placement does not fit a standard template. As an independent Lloyd’s broker, Costero Brokers combines the reach and resources of the world’s leading specialty insurance marketplace with nimble, personal and solutions-focused service.

London’s global role in specialty risk

The London insurance market remains one of the most important centres for commercial insurance and reinsurance worldwide. The London Market Group’s latest data values the market at USD $187 billion in gross written premium, up 17% from 2022, with an 8.7% share of the global insurance and reinsurance market. London remains particularly influential in specialist classes, holding around 45% of the global marine and aviation market and just under 20% of property business. (Source: London Market Group)

At the centre of this ecosystem is Lloyd’s of London. Lloyd’s is not an insurance company but a marketplace that brings together specialist underwriting businesses, capital providers, brokers and distribution partners. In 2025, the Lloyd’s market recorded GBP £57.9 billion of gross premium and reported GBP £10.6 billion of profit before tax. Its scale matters, but so does the diversity of risk appetites and expertise available within the market. (Source: Lloyd’s)

This makes London and Lloyd’s especially relevant when you are seeking cover or capacity for risks that are unusual, emerging, technically demanding or difficult to place in domestic markets. The market handles classes including marine, energy, construction, cyber, political risk, crisis management and professional lines, while also supporting delegated authority and alternative risk transfer structures.

The Lloyd’s broker: connecting risk with capital

A Lloyd’s broker provides the link between insurance businesses around the world and the specialist underwriters operating in London. Much of the business written at Lloyd’s is placed through brokers, who facilitate the transfer of risk between clients and underwriters. At the end of 2025, the market included 401 registered brokers, 103 syndicates and 57 managing agents. (Source: Lloyd’s)

For an overseas retail or wholesale broker, insurer, reinsurer, MGA or InsurTech, the right Lloyd’s broker does much more than pass a submission across a desk. Your broker should help you:

• Present the risk clearly, credibly and in a format that underwriters can assess efficiently.
• Identify syndicates, company markets and international carriers with a genuine appetite for the opportunity.
• Structure open-market, subscription, facultative, treaty, binder or programme solutions where appropriate.
• Negotiate capacity, wording, price and terms while keeping you informed throughout the process.
• Support the placement after inception through endorsements, renewals, claims support and communication and ongoing market engagement.

These activities depend on technical knowledge, judgement and relationships. Lloyd’s is a broker market in which strong relationships, supported by deep expertise, play a crucial role. Direct access to underwriters and decision-makers can help brokers obtain answers quickly and develop commercially effective solutions.

Consolidation is reshaping the broker landscape

The UK insurance broker market has experienced high merger and acquisition activity in recent years. UK insurance-distribution deals reached record totals of 148 in 2023 and 152 in 2024, reducing to 99 in 2025. (Sources: Insurance Business)

That slower pace continued in 2026, with 37 deals announced during the first five months of the year. However, specialty targets – including wholesale businesses and Lloyd’s brokers – continued to account for an above-average share of activity.”(Source: MarshBerry)

Broker consolidation can have both positive and negative impacts for insurance clients. It may bring investment, technology, broader resources and international reach. It can also change the experience of clients and producing partners. Following an acquisition, decision-making may move further away from the people handling your business. Teams, reporting lines, service models and priorities can change. Processes may become more standardised, while unusual or smaller opportunities may struggle to compete for attention against larger group accounts.

For complex specialty business, these changes matter. You may need a broker that can act quickly, approach several markets without unnecessary internal constraints, involve senior specialists early and develop a solution around the risk rather than forcing the risk into an existing process.

Finding the best of both worlds

Working with an independent Lloyd’s broker gives you an alternative: direct access to the strengths of London and Lloyd’s, combined with a closer and more flexible service model.

It’s a powerful combination that can offer several practical advantages:

• Market access without a one-size-fits-all approach. Your broker can look across Lloyd’s, the London company market and international markets to find the right fit for your risk.
• Faster, clearer decision-making. Independent teams can involve the right specialists quickly, without navigating multiple layers of group approval.
• Tailored placement strategies. The structure can be designed around your objectives, whether you need capacity for an individual-risk, a subscription placement, a binder, treaty support or a more innovative risk-transfer solution.
• Senior attention and continuity. You can build direct relationships with experienced brokers who understand the history, detail and commercial purpose of your business.
• Entrepreneurial problem-solving. Independence gives brokers room to challenge assumptions, test new approaches and pursue opportunities that may not fit conventional models.
• Long-term partnership. The focus can remain on developing a sustainable market solution and trusted relationships, rather than simply completing a transaction.

This is particularly valuable for MGAs and InsurTechs developing new products, brokers seeking capacity beyond their domestic markets, and insurers or reinsurers requiring specialist support for unusual exposures. In each case, success depends on matching a strong risk proposition with the right capital, appetite and structure.

Why work with Costero as your independent Lloyd’s broker

Costero Brokers is an independent Lloyd’s broker with established relationships across Lloyd’s, the London company market and international markets. Our teams work with UK, US and international clients on open-market facultative, binding authority, reinsurance and alternative risk transfer business, including hard-to-place and emerging risks.

Costero’s independence supports a flexible and collaborative way of working. Rather than being restricted to a predetermined route, our brokers can assess the available options and build solutions around your specific commercial objectives. This may involve Lloyd’s syndicates, London company markets or carriers in international insurance centres, depending on the nature and location of the risk.

We also combine traditional relationship-led broking with an entrepreneurial approach to new and developing risks. That can be especially important when you are launching a product, establishing or expanding an MGA, seeking delegated authority, entering a new territory or trying to secure capacity for a class that does not yet have an established placement model.

Put the London market to work for you

Lloyd’s and the London market offer exceptional depth, expertise and global reach. But the value you receive depends heavily on the broker helping you navigate that market. Scale is useful – but responsiveness, independence and specialist judgement are equally important.

Costero brings these qualities together: access to Lloyd’s and global insurance markets, combined with the agility, personal service and tailored thinking of an independent broker. To learn more or discuss your insurance challenges and requirements, get in touch with Costero Brokers and speak to our experts.

The second quarter of 2026 has reinforced a clear message for insurers, brokers, MGAs and insurtechs: capacity is available, but risk is becoming more complex. Commercial insurance and reinsurance pricing has continued to soften in many areas, particularly property and catastrophe-exposed programmes, yet this is not a simple return to easy-market conditions.

Insurers remain focused on underwriting discipline, accumulation control, geopolitical exposure, cyber aggregation, AI-related uncertainty and long-tail casualty trends. For buyers, the market offers opportunities to improve structure, pricing and coverage. For carriers and brokers, the challenge is to grow profitably without relaxing standards just as risk is becoming harder to model.

The UK and Global Economy

• The UK economy showed modest growth, but inflation and interest rates remain important for insurers. UK real GDP grew by 0.7% in the three months to April 2026, while CPI inflation was 2.8% in May, unchanged from April. The Bank of England held Bank Rate at 3.75% in June, noting that higher energy costs could still feed through into inflation. For insurers, this keeps reserving, claims inflation, investment income and affordability under close scrutiny. (Sources: ONS GDP, ONS inflation, Bank of England)
• UK political uncertainty also increased during the quarter, with Prime Minister Sir Keir Starmer announcing his resignation on 22 June. Markets and businesses will be watching the leadership transition closely for its implications for fiscal policy, investment and wider confidence. (Source: Reuters)
• Global growth expectations have weakened. The OECD’s June outlook projected global growth slowing from 3.4% in 2025 to 2.8% in 2026 under its time-limited disruption scenario, with the US at 2.0%, the euro area at 0.8% and China at 4.5%. The IMF’s April World Economic Outlook also highlighted the effects of commodity prices, firmer inflation expectations and tighter financial conditions. For the insurance market, that points to a slower demand backdrop, but one with continued volatility in energy, trade and financing conditions. (Sources: OECD, IMF)
• The US remains resilient, but uneven. US first-quarter GDP was revised up to an annualised 2.1%, but consumer spending was revised down to 0.5%, suggesting that headline growth is stronger than household momentum. The Federal Reserve held its policy rate at 3.50%–3.75% in June, while later inflation data kept rate uncertainty alive. For global insurers, the US remains attractive, but casualty severity, legal costs and inflation-sensitive reserving remain key watch-points. (Sources: Reuters [1], [2])

Insurance Industry Developments

• Commercial pricing continues to soften, but not evenly. Global commercial insurance rates fell 5% in Q1 2026, the seventh consecutive quarterly decline. Property rates dropped 9%, while casualty rates increased 3%, driven largely by challenges in the US. In the UK, commercial insurance rates declined 8% in Q1, marking the ninth consecutive quarter of rate decreases. Buyers with good data, clean loss experience and well-managed risk are seeing improved options, while difficult casualty and distressed risks remain more challenging. (Sources: Marsh [1], [2])
• Specialty insurance consolidation remains a major theme. Beazley shareholders approved Zurich Insurance Group’s GBP £8.1 billion cash takeover in April, with Reuters reporting 99.9% shareholder support. The transaction, still subject to final approvals, would create a major global specialty platform with significant cyber, marine, aviation, space and fine art expertise. For brokers and MGAs, this points to continuing consolidation around specialist underwriting, data, distribution and balance-sheet strength. (Source: Reuters)
• Lloyd’s of London is focused on discipline through the softening cycle. Lloyd’s Q2 Market Message highlighted market conditions, capital setting, risk-based oversight and Middle East exposure. The market is entering a more competitive phase while still facing elevated geopolitical, cyber and catastrophe uncertainty. In a softer market, profitable growth is likely to depend on discipline rather than volume alone. (Source: Lloyd’s)
• UK regulators are also looking at simplification and resilience. The FCA’s insurance priorities include work on simplifying rules, including consultation on the Consumer Duty’s application to non-UK business and a review of the international scope of ICOBS and PROD 4. The PRA’s 2026/27 business plan also points to greater use of technology in supervisory processes, including authorisations, internal model approvals and the Senior Managers and Certification Regime. (Sources: FCA, Bank of England/PRA)

Underwriting Performance

• Lloyd’s of London remains strongly profitable, but margins need protecting. Lloyd’s reported 2025 profit before tax of GBP £10.6 billion, gross written premium of GBP £57.9 billion and a combined ratio of 87.6%. These are strong results, supported by underwriting and investment returns. However, as pricing eases, the challenge is to maintain underwriting performance while avoiding exposure creep, wording drift or excessive competition for marginal risks. (Source: Lloyd’s)
• US P&C underwriting improved sharply in Q1. The US property/casualty industry recorded a USD $16.3 billion net underwriting gain in Q1 2026, compared with a USD $1 billion underwriting loss in the prior-year period. Lower catastrophe losses were a major factor, but the improvement also reflects rate action and stronger underwriting in parts of personal and commercial lines. The question for the rest of 2026 is whether those gains can survive renewed storm activity and casualty pressure. (Source: AM Best)
• The market is becoming more segmented. Property, financial lines and cyber have seen increased competition, while casualty, healthcare liability, political violence, marine war and other volatile classes remain much more selective. That creates opportunities for brokers who can present risk clearly and access specialist markets, but it also makes broad “market softening” statements less useful than class-by-class analysis. (Source: Aon)

Tech, Cyber and AI Developments

• AI is now a direct cyber and insurance issue. In June, the Five Eyes intelligence alliance warned that advanced AI models could rapidly increase both offensive and defensive cyber capability. For insurers, this raises several issues at once: faster attack development, automated vulnerability discovery, AI-enabled social engineering and greater uncertainty around aggregation risk. (Source: Reuters)
• Lloyd’s has warned that AI is adding uncertainty to cyber underwriting. Reporting on Lloyd’s Q2 Market Message noted that AI is creating complexity both through its use by threat actors and through questions about whether emerging AI-related liabilities are covered or excluded. This is likely to increase demand for clearer wordings, affirmative cyber and technology cover, and more robust accumulation modelling. (Source: Reinsurance News)
• Cyber frequency remains high, even where some attack types have eased. The UK Government’s Cyber Security Breaches Survey 2025/26 found that 43% of businesses reported a breach or attack, with phishing affecting 38%. Ransomware was reported by 1% of businesses, down from 3% in each of the previous two years, but the broader exposure remains significant, especially for SMEs and supply-chain dependent businesses. (Sources: UK Government, Reuters)

Reinsurance Market

• Reinsurance renewals continued to favour buyers in Q2. April 1 renewals were orderly and competitive. For example, insurers in India secured some of the most favourable reinsurance terms in recent years, with risk-adjusted rate declines of up to 30%. This reflects abundant capital and strong reinsurer appetite, although capacity remains more selective for volatile or poorly modelled exposures. (Source: Reinsurance News)
• US catastrophe renewals remain a key indicator. Analysis points to improved Florida carrier results in 2025, reduced hurricane losses, legal reforms, increased demand for reinsurance and ILS capacity, and a below-average to near-normal Atlantic hurricane outlook. This suggests capacity is available, but reinsurers are still watching attachment points, loss trends and the quality of underlying portfolios. (Source: Guy Carpenter)
• Catastrophe bonds remain an important source of capacity. American Integrity and Safepoint secured $510 million of cat bond protection, with pricing down roughly 25% year-on-year. Gallagher Securities also reported strong Q1 2026 cat bond activity, with USD $5.88 billion issued and an additional USD $1.5 billion announced but not yet settled. This reinforces the growing role of capital markets in catastrophe risk transfer. (Source: Reuters)

Natural Catastrophes

• The Atlantic hurricane outlook is less severe than recent years, but not risk-free. NOAA’s May outlook gave a 55% chance of a below-normal Atlantic hurricane season, a 35% chance of a near-normal season and a 10% chance of an above-normal season. It forecast 8–14 named storms, 3–6 hurricanes and 1–3 major hurricanes. For insurers and reinsurers, a quieter forecast may support pricing pressure – but it should be noted that even a single landfalling storm can still materially alter loss experience. (Source: NOAA)
• Severe convective storms remain a major US loss driver. Gallagher Re data showed US severe convective storm (SCS) insured losses had already exceeded USD $22 billion by 18 June, making 2026 the 11th consecutive year with annual US SCS insured losses above USD $20 billion. Even though the total was below recent first-half averages, the persistence of this peril continues to challenge property pricing, deductibles, modelling and reinsurance structures. (Source: Artemis)
• The longer-term nat-cat trend remains upward. Earthquakes and heatwaves in Q2 underline the continuing human and economic volatility of natural catastrophe risk. Swiss Re estimated that insured natural catastrophe losses could reach around USD $148 billion in 2026 if they follow the long-term trend, with a peak-loss scenario as high as USD $320 billion. That underlines the continuing need for better exposure data, adaptation, risk mitigation and products that address the protection gap in catastrophe-exposed regions. (Source: Swiss Re)

Geopolitical Risks

• Middle East shipping risk has remained highly sensitive. War risk premiums for Strait of Hormuz transits rose sharply earlier in the year, while London market bodies stressed that insurance remained available subject to risk assessment and pricing. By late June, oil prices had fallen back towards pre-conflict levels as vessels exited the Strait and supply concerns eased, but safety, insurance and mine-clearance issues continued to affect confidence. (Sources: Reuters, LMA [1], LMA [2])
• Political risk insurance is becoming more important for reconstruction and investment. In June, the US International Development Finance Corporation and the World Bank’s Multilateral Investment Guarantee Agency agreed to establish a political risk insurance framework to support private investment linked to Ukraine’s reconstruction. This is a reminder that insurance is increasingly being used not only to transfer risk, but to unlock capital in fragile or conflict-affected markets. (Source: Reuters)

Looking ahead: Market needs and insurance gaps

The rest of 2026 is likely to be shaped by a tension between abundant capacity and complex risk. Buyers may find more competitive pricing in property, cyber and financial lines, but difficult placements will still require careful broking, strong data and access to specialist capacity.

Several areas stand out for future market investment:

• AI and cyber coverage clarity: Clients need clearer answers on what is covered, excluded or silently accumulated across cyber, technology E&O, professional indemnity, crime, D&O and media liability. This is likely to become one of the defining wording issues of the next market cycle.
• Catastrophe protection and resilience: Severe convective storm, wildfire, flood and hurricane exposure continue to expose gaps in modelling, affordability and take-up. Parametric insurance, public-private schemes and better mitigation incentives are likely to remain important areas for development.
• Marine, trade and political risk solutions: Recent Middle East disruption and the Ukraine reconstruction framework show the growing need for flexible political risk, marine war, cargo, trade credit and supply-chain solutions. Capacity exists, but pricing and appetite can move quickly when geopolitical risk changes.
• Specialty growth and innovation: Research suggests that the global insurance market may grow at an annual rate of 5.3% over the next ten years, with P&C growth at 4.7%. Much of that growth is likely to come from areas where conventional cover is not yet keeping pace with client need: cyber, AI, climate adaptation, critical infrastructure, energy transition, life sciences, digital assets and complex global supply chains. (Source: Allianz)

Overall, Q2 2026 has been a buyer-friendlier quarter in many parts of the market, but not a risk-light one. The best outcomes will continue to depend on specialist placement strategy, transparent underwriting information, disciplined capacity and insurance solutions that are designed for the risks clients actually face now – not just the risks the market has historically found easiest to insure.

If you would like to discuss what these developments could mean for your placement strategy, renewal planning or access to specialist capacity in 2026, please get in touch with Costero Brokers or explore more insights on our website.

Disclaimer:

This market report was developed for reference only, and any prospective statements about possible future events or performance are based on developing factors regarding economic and business activity relevant to financial and insurance markets. Such prospective statements involve risk as actual results may differ materially from those expressed or implied due to future changes in relevant factors. We are not responsible for the accuracy of the third-party information cited herein and undertake no obligation to update any such data or prospective statements, nor do we in any way intend to provide legal, financial, or insurance advice regarding any existing or future litigation or other matter discussed or projected herein. Please seek the advice of your own professional advisors or counsel regarding your specific circumstances.

Explore the latest cyber risks facing datacentres, from outages and ransomware to third-party liability, and learn how specialist cyber insurance can help protect operators.

Datacentres have become critical infrastructure for the digital economy. They support cloud services, AI platforms, financial systems, government, healthcare, logistics, retail, media and almost every online customer experience. That makes datacentres attractive targets for cybercriminals, hostile nation-state actors and opportunistic hackers. It also means that when a datacentre suffers a cyber incident, the effects can move quickly from technical disruption to contractual liability, customer loss, regulatory scrutiny, reputational damage and major financial impact. Costero Brokers helps datacentre operators and their insurance partners (including brokers, MGAs and InsurTechs) build specialist cyber insurance programmes that reflect the real operational, contractual and third-party risks involved.

The fast-changing cyber threat landscape for datacentres

For datacentres today, cyber risk exposure is increasingly complex. It sits across IT systems, operational technology, customer portals, remote access tools, building management systems, power and cooling infrastructure, managed service providers and the wider software supply chain.

Fast-growing AI workloads also raise the stakes, because higher-density computing can increase dependency on power, cooling, specialist hardware and tightly managed uptime.”

Attackers know that datacentres are high-pressure environments. Downtime is immediately visible. Customers may depend on strict uptime commitments. A loss of access, service degradation, ransomware event, malicious insider incident or compromised management platform can create financial pressure within minutes.

The broader cyber picture remains difficult. The UK Government’s Cyber Security Breaches Survey 2025/2026 found that 43% of businesses identified a cyber breach or attack in the previous 12 months. Phishing remained the most common type, experienced by 38% of businesses overall and by 88% of affected businesses. A major concern for datacentres is how phishing, stolen credentials and supplier compromise can become the first step towards operational interruption. (Source: UK Government)

High-profile incidents show impacts of datacentre disruption

Most cyber incidents involving datacentres go unreported publicly, but events of recent years have shown how dependent businesses are on resilient digital infrastructure.

In June 2024, a ransomware attack compromised Indonesia’s national datacentre, disrupting immigration checks at airports and prompting a USD $8 million ransom demand. That incident was a stark reminder that datacentre disruption is not only a business risk – it can disrupt vital public services and raise wider questions about national resilience. (Source: Reuters)

In July 2024, a faulty software update from cybersecurity firm CrowdStrike caused a major global IT systems outage, creating disruption across airlines, banks, hospitals, retailers, broadcasters and other organisations. This was not a malicious cyberattack, but it showed how a single technology failure can cascade across organisations and systems worldwide. Insured losses from the event were estimated at up to USD $1.5 billion. For datacentre operators, the lesson is clear – whether a disruption is triggered by malicious code, failed software, compromised access or supplier error, the commercial consequences may still land at your door. (Source: Reuters)

Outage research points in the same direction. Uptime Institute’s Annual Data Center Outages Analysis 2026 says outage prevention remains a central focus for datacentre operators as demand growth, AI-driven workloads and power constraints reshape risk profiles. It also highlights increasing system complexity, grid instability, growing co-dependencies and evolving external threats as risks operators must actively manage. Even where outages are becoming less frequent, the cost and reputational consequences of serious failures remain high. (Source: Uptime Institute)

Datacentre operators face a unique mix of liability risks

A cyber incident at a datacentre does not only affect the operator’s own systems. It can affect every customer relying on that environment. That is where the risk becomes more complex than standard business interruption. Your exposure may include:

• Service level agreement penalties: Customers may have contractual rights if uptime, availability or recovery commitments are missed.
• Third-party liability claims: Customers may claim for lost revenue, service interruption, data loss or costs passed down from their own clients.
• Incident response costs: Specialist legal, forensic, communications and recovery support may be needed immediately.
• Regulatory and notification costs: Data protection, critical infrastructure or sector-specific rules may require rapid reporting and remediation.
• Reputational damage: Datacentre customers buy confidence. A major outage or breach can make future sales harder, even after systems are restored.
• Supply chain disputes: Responsibility may be contested between the operator, cloud provider, software vendor, security supplier, facilities contractor or managed service provider.

This is why a standard cyber policy may not be enough. A datacentre is not simply “a business with IT”. It is the environment other businesses depend on to operate.

Cyber security is essential, but it cannot remove all risk

Strong cyber security remains the first line of defence. Any responsible datacentre operator today will invest in layered protection, including identity controls, network segmentation, privileged access management, endpoint detection, resilient backups, incident response planning, supplier assurance, physical security and operational technology monitoring.

The UK National Cyber Security Centre’s supply chain guidance warns that organisations often depend on complex supplier networks where vulnerabilities can be introduced or exploited at many points. That is particularly relevant for datacentres, where software, hardware, maintenance, energy, telecoms and managed services all form part of the resilience picture. (Source: NCSC)

But no security measure can guarantee total protection. Even the most experienced and best-prepared datacentre operators can be affected by zero-day vulnerabilities, social engineering, cloud dependency, accidental configuration changes, compromised suppliers or geopolitical events. Cyber security should therefore be complemented by appropriate cyber insurance as part of a broader resilience strategy, not as an afterthought.

Why datacentre cyber insurance must be tailored

The right insurance programme depends on the nature of your datacentre, your customers, your contracts and your technology stack. A colocation provider leasing rack space to enterprise clients faces different risks from a hyperscale operator, managed hosting provider, cloud platform, edge datacentre or specialist facility supporting AI workloads.

A tailored programme should consider cover for:

• First-party business interruption: Protecting lost income and extra expense following a covered cyber event.
• Dependent business interruption: Responding where disruption is caused by a critical supplier, cloud provider, telecoms provider or technology dependency.
• Incident response and recovery: Funding forensic investigation, legal support, crisis communications and restoration costs.
• Cyber extortion and ransomware: Supporting response to ransom demands, negotiation, containment and recovery.
• Technology errors and omissions: Addressing claims that your technology services failed to perform as promised.
• Network security and privacy liability: Covering claims arising from unauthorised access, data compromise or system failure.
• Contractual liability analysis: Reviewing how policy language interacts with customer contracts, indemnities and service level agreement (SLA) commitments.
• Regulatory response costs and fines: Supporting defence, investigation and response costs following a regulatory event (where insurable by law).

For datacentre operators, wording detail matters. The exact agreed policy definitions of terms such as ‘computer system’, ‘network interruption’, ‘security failure’, ‘system failure’, ‘supplier’, ‘cloud provider’ and ‘dependent business interruption’ can make a major difference when a claim is tested.

Why Lloyd’s is a global marketplace for datacentre cyber insurance

Lloyd’s of London is one of the world’s leading marketplaces for complex and specialist insurance. Cyber is now one of the fastest-growing classes at Lloyd’s, with more than one-fifth of global cyber insurance placed there. Lloyd’s and the Association of British Insurers (ABI) have also published guidance on the components of a ‘major cyber event’, reflecting the market’s focus on systemic cyber risk, aggregation and resilient insurance capacity. (Source: Lloyd’s/ABI)

The risk profile for datacentres is both specialist and global. Operators may serve customers across multiple jurisdictions, support regulated industries and depend on layered technology ecosystems. Lloyd’s brings together underwriters with expertise in cyber, technology, professional liability, business interruption, crisis response and multinational placements.

How an expert Lloyd’s broker helps build the right insurance solution

As a trusted Lloyd’s broker with broad cyber expertise, Costero Brokers works with clients to obtain cyber insurance programmes designed around their actual risks, not off-the-shelf assumptions. For datacentre operators and their insurance partners (including brokers, MGAs and InsurTechs), that means understanding the business model, customer contracts, uptime obligations, supplier dependencies, security controls, claims scenarios and growth plans before approaching the market.

We can help you present your risk clearly to Lloyd’s underwriters, negotiate appropriate limits and retentions, challenge exclusions, review policy wording and build a programme that supports both resilience and commercial confidence.

Take the next step to better datacentre cyber insurance

Datacentre cyber risk is evolving quickly. The operators that respond best will be those that combine strong security, tested continuity planning and insurance designed for the realities of their business.

To learn more, discuss your challenges and explore the right protection for your organisation or clients, get in touch with Costero Brokers and speak to our expert, Jonathan Olley, Divisional Director – Cyber, Media & Technology.

Learn why your Lloyd’s broker should give you more than market access: You should expect transparency, advocacy and a clear placement strategy that helps you secure the right specialty insurance solution.

When you are placing complex or specialty insurance risk, your choice of Lloyd’s broker can make a material difference to the quality of your outcome. You need a partner who can understand your business, explain the market clearly, advocate for your interests and build a strategy that gives your submission the best chance of success. In this article, we look at the global importance of Lloyd’s and the London market, the role of the Lloyd’s broker, and the key qualities you should expect from your broker – including transparency, advocacy and market strategy. We also explain how Costero helps brokers, insurers, MGAs and InsurTech businesses worldwide access specialist capacity and build practical solutions for challenging insurance needs.

Why Lloyd’s of London is the global hub for specialty insurance

London is one of the world’s most important centres for commercial and specialty insurance. The London market brings together brokers, underwriters, syndicates, managing agents, reinsurers, lawyers, claims specialists and risk experts in a concentrated ecosystem built around complex risk transfer. A 2026 report by the London Market Group (LMG) estimates that the London market grew to around USD $187 billion in gross written premium in 2024, up 17% since 2022. (Source: LMG)

Lloyd’s of London sits at the heart of that ecosystem. Lloyd’s reported 2025 gross written premium of £57.9 billion, profit before tax of £10.6 billion and a combined ratio of 87.6%. (Source: Lloyd’s)

These figures show the scale, depth and continuing importance of Lloyd’s as a marketplace for specialist risk. But the real value of Lloyd’s is not just capacity. It is the combination of capital, underwriting expertise, product innovation and face-to-face market judgement. The majority of business written at Lloyd’s is placed through brokers, who facilitate the risk-transfer process between clients and underwriters. (Source: Lloyd’s)

For insurance market participants around the world, Lloyd’s is the natural focus when risk is not straightforward. Cyber, marine, political violence, energy, professional liability, delegated authority, reinsurance and emerging industry risks often need more than a standard insurance product. They need specialist presentation, careful market selection and an informed negotiation process.

The Lloyd’s broker as a market connector

A Lloyd’s broker is not simply an intermediary who passes information from one party to another. At their best, Lloyd’s brokers enable relationships between insurance businesses worldwide and the London market participants that can support them. This can involve bringing many different parties and resources together:

• Retail and wholesale brokers with Lloyd’s syndicates and company markets.
• MGAs and coverholders with capacity providers and delegated authority partners.
• Insurers and reinsurers with specialist London expertise.
• InsurTechs and emerging-risk businesses with markets prepared to evaluate new exposures.
• Clients with claims, wording, actuarial and regulatory expertise when placements become more complex.

This relationship-building role is especially important because Lloyd’s and the London market do not operate like a single-carrier placement environment. A placement may involve multiple underwriters, follow markets, delegated authority arrangements, layered structures, reinsurance support or bespoke policy wordings. The Lloyd’s broker’s job is to make that complexity workable.

The best Lloyd’s brokers have strong relationships with London-based underwriters while also looking further for the most appropriate insurers or reinsurers for their client, including markets beyond London where appropriate. (Source: LMG)

Your broker should not simply send a submission into Lloyd’s and hope for the best. They should understand which markets are likely to respond, what information those markets will need, what concerns underwriters may raise, and how the placement should be positioned.

What specific qualities should you expect from your Lloyd’s broker?

The right broker should bring technical knowledge, market access and strong relationships. But those qualities only create value when they are applied in the right way. Three expectations should sit at the centre of the relationship: transparency, advocacy and market strategy.

1. Transparency – clarity in a complex market

Transparency starts with clarity. You should know what your Lloyd’s broker is doing, which markets are being approached, what feedback is coming back, where the challenges are, and how decisions are being made.

In a specialist placement, this means your Lloyd’s broker should explain:

• Which markets are being approached and why.
• What information underwriters need before they can quote.
• How pricing, limits, retentions, exclusions and conditions compare.
• Where there are gaps, restrictions or wording issues.
• What fees, commissions or remuneration structures apply.

Transparency is also about realistic advice. If a risk is difficult, your broker should say so. If the market is likely to challenge a particular exposure, loss history, data quality issue or contract wording, you need to know early. That gives you time to improve the submission, adjust expectations or consider alternative structures.

Regulatory expectations also reinforce the importance of transparency and customer outcomes. The UK Financial Conduct Authority (FCA) has continued to focus on firms demonstrating fair value and good outcomes in insurance, while Lloyd’s principles emphasise robust frameworks that support compliance and transparent relationships with regulators and Lloyd’s. (Sources: FCA, Lloyd’s)

For international clients, transparency can be especially valuable because the London market has its own terminology, processes and practices. Your broker should make the market easier to understand, not more opaque.

2. Advocacy – presenting your case clearly and persuasively

A strong Lloyd’s broker should advocate for your interests in the market. That does not mean over-selling a risk or ignoring underwriter concerns. It means presenting your case clearly, professionally and persuasively, so that underwriters can make an informed decision.

Good advocacy from your Lloyd’s broker includes:

• Understanding your business model, risk profile and commercial objectives.
• Preparing a submission that answers underwriter questions before they become objections.
• Explaining why the risk is insurable, sustainable and worth supporting.
• Challenging unclear, inconsistent or overly restrictive market responses where appropriate.
• Keeping momentum in negotiations and helping you respond quickly to market feedback.

In complex specialty insurance, underwriters often need context. A cyber risk may require a clear explanation of controls, incident response and dependency exposures. A marine or cargo placement may need detail on territories, routes, aggregation and sanctions considerations. An MGA or delegated authority opportunity may need evidence of underwriting discipline, data quality, claims handling and governance.

Your Lloyd’s broker’s advocacy role is to help turn that complexity into a coherent underwriting story. That can make the difference between a weak submission that stalls and a well-structured approach that gives markets the confidence to engage.

Advocacy also continues after placement. Claims service, policy interpretation, renewal preparation and changing risk exposures all require active broker involvement. Lloyd’s has increased its focus on claims performance, with claims becoming a more prominent part of market oversight and syndicate performance expectations. (Source: Lloyd’s)

3. Market strategy – applying intelligence and experience

Market strategy is where an expert Lloyd’s broker shows their edge. Market access is needed, but access without strategy can waste time, weaken negotiating leverage and create confusion.

A well-considered market strategy should answer questions such as:

• Which markets are most suitable for this risk and why.
• Whether the placement should be open market, delegated authority, facultative reinsurance, treaty reinsurance, layered, quota share or another structure.
• Which underwriters should be approached first.
• How to sequence discussions between lead and follow markets.
• What information should be improved before the risk is marketed.
• How to balance price, coverage, security, service and long-term relationship value.

This is especially important when market conditions are competitive or changing. Lloyd’s 2025 results noted a more competitive pricing environment, even while disciplined underwriting continued to support price adequacy. (Source: Lloyd’s)

In this environment, you need more than a broker who can chase the cheapest quote. You need a trusted partner who can help you understand whether the available solution is sustainable, whether wording quality is acceptable, whether capacity is reliable, and whether the structure will still work at renewal.

For MGAs, coverholders and InsurTech businesses, market strategy may also include preparing for capacity discussions, evidencing underwriting discipline, improving bordereaux and data presentation, or identifying which markets are most likely to support a new programme. Lloyd’s delegated authority framework underlines the importance of managing delegated underwriting arrangements effectively, including the responsibilities of managing agents when authority is delegated to coverholders. (Source: Lloyd’s)

How Costero Brokers supports your specialty insurance needs

Costero Brokers is an independent Lloyd’s broker focused on helping clients solve difficult placement challenges. We are a team of problem-solving brokers, combining trust, respect and integrity with a forward-thinking approach to managing risk.

We help our clients navigate the London market with clarity and purpose. That includes preparing risks properly, approaching suitable markets, communicating effectively with underwriters and building solutions around the client’s actual requirements rather than forcing them into a pre-set template.

As an independent broker, Costero can look across Lloyd’s, London, European and international company markets to identify appropriate capacity and structures. We specialise in open market facultative, binding authority, reinsurance and alternative risk transfer business, with a focus on finding capacity for hard-to-place or emerging risks.

Our independence supports the qualities you should expect from a Lloyd’s broker, including:

• Transparency – because you need clear advice, honest market feedback and visibility over your options.
• Advocacy – because complex risks need to be explained, defended and negotiated with care.
• Market strategy – because the right solution depends on market selection, timing, structure and execution.

For insurers, brokers, MGAs and InsurTech businesses, the benefit is practical. You get a partner who understands how the Lloyd’s and London market ecosystem works, who can speak the language of underwriters, and who can help you build a placement strategy that reflects both your immediate needs and your long-term objectives.

Find a Lloyd’s broker with the qualities you need

The Lloyd’s market offers extraordinary depth of expertise and capacity, but it is not a market to approach casually. The right Lloyd’s broker should help you understand your options, present your risk effectively and negotiate a solution that works in the real world.

To learn more about how we can help with your insurance challenges and specialty risk requirements, get in touch with Costero Brokers and speak to our experts.

Discover how relationships, trust and face-to-face negotiation are foundational to the London insurance market – and how Costero Brokers can help you access specialist Lloyd’s expertise.

The London insurance market has always been about more than just capacity, capital and contracts. Its real strength lies in the relationships that connect brokers, underwriters, syndicates, managing agents, reinsurers, MGAs, InsurTechs and clients across the world. For complex and specialty risks, those relationships are vital because optimum outcomes often depend on trust, judgement and direct negotiation. Working with an experienced independent Lloyd’s broker such as Costero Brokers can help you connect with the right market participants, present your risk clearly and build a solution shaped around your needs.

London’s global role in specialty insurance

London remains the world’s leading hub for commercial and specialty insurance. The market employs more than 59,000 people and attracts more than USD $159 billion in premium each year, bringing together specialist commercial broking and underwriting communities across Lloyd’s of London, the London company market and associated professional services. (Source: London Market Group)

Lloyd’s of London is central to that global reputation. In 2025, the Lloyd’s market reported gross written premium of GBP £57.9 billion, profit before tax of GBP £10.6 billion and a combined ratio of 87.6%, supported by total capital of GBP £49.8 billion. (Source: Lloyd’s)

These impressive figures show the scale and resilience of the marketplace, but they only tell part of the story. Lloyd’s is valued globally because it brings together specialist underwriting expertise for risks that may be difficult, unusual, emerging or too complex for standard domestic markets.

This is important if you are trying to place risk across areas such as cyber, marine, energy, political violence, professional liability, delegated authority, parametric insurance or new technology-led propositions. In these areas, cover is rarely a simple off-the-shelf purchase. It often requires negotiation, explanation and confidence between the parties involved.

An insurance market built on personal connections

The London insurance market’s relationship-led culture goes back to its earliest days. Lloyd’s traces its origins to Edward Lloyd’s coffee house by the River Thames in the 1680s – a gathering place for merchants, entrepreneurs, sea captains and ship owners – which became a centre of marine intelligence and helped found the modern insurance industry. (Source: Lloyd’s)

That history still shapes the way the London market works. From the beginning, London insurance was based on gathering information, judging risk and agreeing terms between people who knew each other’s reputations. A broker did not simply submit a risk. They explained it, advocated for it and negotiated support from underwriters willing to commit capital.

The times have changed, but the principle has not. Business in the Lloyd’s market is still conducted face to face, with the busy underwriting room central to the smooth running of the market. The majority of this business is placed through specialist Lloyd’s brokers, who facilitate the risk-transfer process between clients and underwriters. (Source: Lloyd’s)

Why human relationships still matter in a digital market

Lloyd’s now operates in a more digital trading environment, with electronic placement, structured data and modernised market processes supporting the way risks are submitted, negotiated and processed.

But technology does not remove the need for human judgement. In specialty insurance, the real challenge is often not just transferring data from one system to another. It is helping an underwriter understand why a risk is credible, why a structure makes sense, and why the proposed terms are commercially workable.

Market relationships are important because they help brokers and underwriters move beyond the surface facts of a submission. Strong relationships can support:

• Better understanding of the risk story behind the data.
• Faster access to relevant decision-makers.
• More open discussion of appetite, pricing, exclusions and structure.
• Greater confidence when a risk is new, unusual or hard to benchmark.
• Constructive negotiation when terms need to be refined.
• Better communication if circumstances change after placement.

For example, a broker who knows an underwriter’s appetite can often tell whether a risk needs more data, a different structure, a stronger narrative or a more suitable lead market before time is wasted on an unsuitable submission.

Interpersonal ‘soft skills’ are vital in this environment. They are at the heart of the mechanism that helps the market work. Listening carefully, asking the right questions, reading the room, understanding underwriter appetite and knowing when to push – or when to pause – can all affect the outcome.

Your broker as London market relationship-builder

The Lloyd’s broker plays a vital role in connecting insurance players worldwide with the London market. Lloyd’s is a broker-enabled market in which strong relationships, backed by deep expertise, play a crucial part. Much of the business placed involves face-to-face negotiations between brokers and underwriters. There are now around 400 registered brokers at Lloyd’s.

For insurance market participants worldwide – including brokers, insurers, MGAs and InsurTechs – working with the right Lloyd’s broker is important. You may have a strong client base, a specialist product idea or a book of business with growth potential. But without the right route into Lloyd’s and the wider London market, it can be difficult to identify the most relevant underwriters, present the opportunity effectively or secure the right blend of capacity.

Your Lloyd’s broker helps by:

• Translating your risk or product concept into a clear market presentation.
• Identifying underwriters with relevant appetite and expertise.
• Negotiating terms, pricing and coverage structure.
• Building support from lead and follow markets where needed.
• Managing the practical details of documentation, endorsements and ongoing communication.
• Advising when Lloyd’s is the right market – and when a wider or alternative solution may be better.

Registered Lloyd’s brokers have direct access to a unique pool of underwriting expertise in the Lloyd’s global marketplace, especially for clients requiring specialist, innovative or bespoke risk solutions.

Why insurance market trust is commercially valuable

Trust is not just a watchword in the London market. It has practical commercial value. Underwriters need confidence that the broker understands the class of business, has presented the risk fairly, and will manage communication properly throughout the life of the placement. Clients and producing brokers need confidence that their Lloyd’s broker is acting in their interests, not simply steering them towards the most convenient option.

That is particularly important where risks are complex, fast-moving or difficult to standardise. The London market can act as a partner for insurance and reinsurance clients globally, providing a home for challenging and developing risks that local insurers may not wish to, or cannot, underwrite.

In this environment, relationships can help create better outcomes because they enable honest conversations. A good broker can find out where appetite genuinely sits, what information is missing, what structure might unlock support, and how to avoid spending time on options that are unlikely to progress.

How Costero Brokers builds stronger market relationships

As an independent Lloyd’s broker, Costero Brokers combines market access with neutrality, agility and specialist experience. Our independence makes a real difference. You need a broker who can look across the market, assess the available options, and build a solution around your requirements rather than around a single market or provider.

For brokers, insurers, MGAs and InsurTechs, Costero can help you use London market relationships intelligently. That may mean finding specialist capacity for a hard-to-place risk, developing a delegated authority route, structuring a subscription placement, supporting an emerging product line, or sense-checking whether Lloyd’s is the right home for your opportunity.

Our role is not simply to introduce you to the London market. It is to help you tell your risk story in a way underwriters can engage with, negotiate professionally on your behalf, and use trusted relationships to build practical insurance solutions.

Put London market relationships to work for you

The London insurance market continues to evolve, and technology will keep improving how risks are submitted, processed and managed. But for specialty insurance, relationships remain one of the London market’s defining advantages. Complex risks need more than data. They need context, judgement, negotiation and trust.

If you are looking to place a challenging risk, develop a specialist insurance solution or explore how Lloyd’s and the London market could support your business, get in touch with Costero Brokers and speak to our experts about your insurance challenges and requirements.

Explore the new cyber crime threats facing organisations, from AI-enabled fraud and deepfakes to invoice manipulation – and learn how Costero’s Crime Connect insurance solution can help insurers, brokers, MGAs and InsurTechs protect business clients.

Cyber crime is no longer only about hackers breaking into systems. For many organisations, the more immediate and significant threat is financial fraud using deceptive emails, manipulated invoices, fake payment instructions, cloned voices, deepfake video calls and impersonation of trusted executives, suppliers or clients. These attacks are becoming more frequent, more believable and more costly. In this article, we highlight five of the most important cyber crime threats facing organisations today, explain why standard cyber insurance may not be enough, and show how working with a specialist Lloyd’s broker such as Costero Brokers can help you build more effective cyber crime protection.

Cyber crime today is more than just malicious hacking

Cyber security remains a board-level priority for organisations. Ransomware, data breaches, remote access compromise and system downtime continue to be serious threats. The UK Government’s 2025/26 Cyber Security Breaches Survey found that 43% of UK companies identified a cyber breach or attack in the previous 12 months, affecting an estimated 612,000 businesses. (Source: UK Government)

But the cyber risk landscape is evolving. Criminals do not always need to defeat your firewall if they can persuade a member of your finance team to make a real payment to the wrong account. Business email compromise, invoice manipulation, supplier impersonation and fund transfer fraud exploit the normal flow of business. They target trust, urgency and routine.

The FBI’s 2025 Internet Crime Report showed cyber-enabled crimes defrauded US victims of nearly USD $21 billion, with AI-enabled incidents among the costliest at almost USD $893 million. The FBI also highlighted compromised corporate emails, voice clones, fake credentials and believable videos as part of the modern fraud toolkit. (Source: FBI)

For organisations today, this is the uncomfortable reality: the weakest point may not be your technology, but the moment a busy employee receives a credible-looking request from someone they think they know and trust.

The top 5 cyber crime threats facing organisations today

1. AI-enabled social engineering

Social engineering is the use of deception to manipulate people into revealing information, changing details, making payments or taking other actions that benefit the criminal.

The technique is not new, but artificial intelligence (AI) has made it more scalable and persuasive. AI can also reduce the obvious red flags – poor grammar, awkward phrasing or inconsistent tone – that once helped staff spot suspicious emails.

Criminals can now generate polished fake emails, translate them accurately, imitate writing styles and produce more convincing lures at volume. They are increasingly using technology to make impersonation more effective, including cloned voices, video deepfakes and executive impersonation.

Social engineering can bypass many traditional controls. A payment instruction may appear to come from a trusted email account. The language may sound normal. The timing may fit a genuine transaction. By the time the fraud is spotted, the money may already have moved through several accounts or jurisdictions.

2. Deepfake executive impersonation

The best-known recent deepfake fraud example remains the 2024 case in Hong Kong, where an employee of global engineering firm Arup was reportedly deceived into transferring HKD $200 million, around USD $25 million, after attending what appeared to be a video call with senior executive colleagues. Arup confirmed that fake voices and images were used and said its internal systems were not compromised. (Source: The Guardian)

This was not simply a systems breach – it was a sophisticated deception that exploited trust, hierarchy and normal approval behaviour. The employee believed the instruction was legitimate because the people on the call appeared to be real executives of the business.

For organisations with international finance teams, multiple offices, remote working, high-value payments or decentralised approval processes, this creates a serious exposure. Criminals can scrape public video, podcasts, webinars, social media and conference appearances to build more convincing impersonations of executives, clients or suppliers.

3. Business email compromise and fund transfer fraud

Business email compromise (BEC) remains one of the most damaging forms of cyber-enabled financial crime. The UK Government’s Fraud Strategy 2026-2029 defines business email compromise as fraud where criminals impersonate a trusted contact by email to divert payments or steal sensitive business data. (Source: UK Government)

A 2026 cyber claims study found that business email compromise and funds transfer fraud together accounted for 58% of claims analysed, while 71% of funds transfer fraud claims were directly linked to social engineering. (Source: Coalition)

Typical scenarios include:

• Criminals impersonate suppliers and ask for bank details to be changed.
• Finance teams receive convincing emails from compromised executive accounts.
• Client or vendor accounts are taken over and used to redirect legitimate payments.
• Fraudsters insert themselves into genuine transactions and manipulate payment instructions.

These risks are now becoming daily business exposures for all kinds and sizes of organisation.

4. Invoice manipulation and supplier impersonation

Invoice manipulation is especially dangerous because it hides inside normal commercial processes. Businesses in sectors such as construction, manufacturing, real estate and professional services often deal with large invoices, multiple parties and frequent payment changes. That gives fraudsters room to manoeuvre.

A 2026 cyber claims report found financial fraud is now the most common incident type, representing around 30% of claims for the third consecutive year. Average stolen funds reached USD $285,000 per incident in 2025, up 16% year on year. The largest single financial fraud loss in that analysis reached USD $9.7 million. (Source: Help Net Security)

The most dangerous invoice frauds often look boring. That is exactly why they work. A payment update, a changed account number or a slightly altered invoice may not trigger alarm if it appears to come from a known supplier at the right point in a transaction.

5. Abuse of trusted platforms and cloud infrastructure

Cyber criminals increasingly hide inside tools that businesses already trust. Instead of relying only on suspicious domains or obvious malware links, attackers route malicious content through legitimate services, cloud platforms and collaboration tools.

The 2026 InsurSec Report suggested that attackers are using services such as Microsoft Exchange Online, Cloudflare, Canva, TikTok and Dropbox to make fraudulent emails look more legitimate and harder for legacy email filters to block. It also found that email was the initial entry vector in 82% of financial fraud claims. (Source: At-Bay)

This is a major challenge for organisations because employees are trained to trust familiar platforms. A link that appears to come through a recognised service may not feel suspicious. Yet it can still lead to credential theft, email account compromise and fraudulent payment instructions.

How organisations can defend themselves

Strong controls still reduce cyber risk. Organisations should review their payment processes, train employees to recognise fraud, and strengthen identity and access controls. Practical steps for organisations include:

• Require call-back verification for new bank details and urgent payment changes, using trusted contact details – not those newly supplied.
• Use multi-person approval for high-value transfers.
• Apply multi-factor authentication across email, finance and remote access systems.
• Train staff on deepfake, voice cloning and supplier impersonation risks.
• Segregate payment authority so that no single person can approve and release large transfers.
• Consider a short cooling-off period for first payments to new accounts or urgent changes to supplier bank details.
• Escalate suspected fraud immediately, including prompt notification to banks, law enforcement and insurers where appropriate.

However, no cyber security measures can guarantee total protection. People make mistakes. Supplier accounts get compromised. AI-generated impersonations are becoming more believable. That is why cyber insurance must be part of the wider resilience strategy, not an afterthought.

Why standard cyber insurance may not be enough

Many conventional cyber policies were designed primarily around risks from data breaches, ransomware, system compromise, privacy liability and business interruption. Those covers remain valuable, but they may not respond adequately to large financial fraud losses.

If covered at all, risks such as social engineering, invoice manipulation and fund transfer fraud may be subject to low sublimits, often around USD $250,000.

That may be nowhere near enough if a fraudster diverts a seven-figure payment. A business can have cyber insurance and still discover that the relevant fraud cover is only a fraction of the loss.

How specialist cyber crime cover can help close the gap

To address this protection gap, Costero Brokers has developed a specialist cyber crime insurance solution – Costero Crime Connect. The product is proprietary to Costero and has been developed in partnership with Lloyd’s of London syndicates to provide standalone or excess limits for e-crime cover up to USD $10 million.

Costero Crime Connect can help organisations access higher limits for key cyber crime exposures, including:

• Social engineering
• Invoice manipulation
• Fund transfer fraud

The capacity can be structured in several ways, including excess of sublimits within an existing cyber policy, standalone e-crime coverages, or standalone e-crime coverages alongside traditional crime insuring agreements.

For insurers, brokers, MGAs and InsurTechs, that flexibility is a real advantage. Some client organisations may need to top up low sublimits in an existing cyber programme – while others may need a dedicated e-crime solution because their payment flows, client base, industry sector or transaction values create a larger exposure.

Building protection around evolving cyber crime risks

Cyber criminals are not waiting for insurance policies to catch up. They are already using AI, deepfakes, compromised emails, supplier impersonation and trusted digital platforms to target organisations and their staff.

Costero Brokers can help insurers, brokers, MGAs and InsurTechs protect clients against these growing cyber crime risks – and can also work directly with larger organisations. We can review where current cyber and crime insurance arrangements may leave gaps, assess whether fraud limits match real-world exposure, and access specialist Lloyd’s capacity for cyber crime risks.

To learn more about Costero Crime Connect and discuss your cyber crime insurance challenges, get in touch with Costero Brokers and speak to our expert, Jonathan Olley, Divisional Director – Cyber, Media & Technology.

Discover how new technologies are supporting traditional independent broker expertise for specialty insurance in the Lloyd’s market – from digital workflows and data quality to operational resilience and client service.

Technology is changing how insurance business is placed, managed and serviced in the Lloyd’s of London market. But it is not replacing the fundamentals that make specialty insurance work: human judgement, strong market relationships, expert underwriting, disciplined risk information and responsive client service. For brokers, insurers, MGAs and InsurTechs, the opportunity is to use technology in practical ways that reduce friction, improve data quality, strengthen resilience and help complex risks reach the right capacity. Working with an experienced Lloyd’s broker such as Costero Brokers can help you combine modern digital workflows with the specialist market knowledge still needed to get business done well.

The pressures driving insurance technology change

Today’s insurance market is under pressure from several directions at once. Clients want faster answers, clearer communication and more certainty around documentation. Brokers and carriers are dealing with rising operating costs, complex compliance expectations, legacy systems, cyber threats and growing volumes of data. MGAs and InsurTechs need to prove they can scale efficiently while keeping underwriting discipline, reporting and governance under control.

These pressures are especially visible in the specialty market, where risks are often complex, international and difficult to standardise. A submission may involve multiple territories, several layers of coverage, unusual exposures, detailed claims information and negotiation with more than one market participant.

Technology can help address these issues, but only when it supports the way specialty insurance actually works. The goal is not to remove human expertise from the process. It is to give brokers, underwriters and clients better tools for gathering information, assessing risk, communicating clearly and making informed decisions.

The marketplace for global specialty insurance

Lloyd’s of London is not a single insurance company. It is the world’s specialty insurance and reinsurance market, bringing together underwriting businesses, brokers, capital providers and coverholders to insure complex and often unusual risks. The market comprises more than 50 leading insurance companies, over 400 registered brokers and a global network of more than 3,000 local coverholders. Lloyd’s provides specialty insurance services across more than 200 territories worldwide, supported by extensive trading rights and specialty underwriting expertise. (Source: Lloyd’s)

For brokers, insurers, MGAs and InsurTechs, Lloyd’s is one of the most important global marketplaces for specialty risk. It combines capital strength, underwriting expertise, international reach and a long-established broker-led trading culture.

Tradition and technology now work together

Lloyd’s has always relied on relationships. Specialist brokers still need to understand underwriting appetite, market conditions, coverage structures, pricing dynamics and the people behind the decisions. Face-to-face conversations and trusted professional relationships are vital.

Today, technology complements tradition. Those human relationships sit alongside digital workflows, structured data, cyber resilience, analytics, automation and artificial intelligence. Lloyd’s 2026 strategy places a technology emphasis on operational resilience, flexible open architecture, individual strategic choice and streamlined data requirements based on common standards. (Source: Lloyd’s)

This strategy recognises that the modern Lloyd’s market needs to be both relationship-led and technology-enabled. Brokers still need judgement, but they also need efficient systems, clean information and secure ways to collaborate with clients and market partners.

How technology is supporting independent Lloyd’s brokers

For independent brokers, technology is evolving the practical mechanics of the job. It can help brokers:

• Collect and structure risk information more efficiently.
• Reduce repeated data entry and manual administration.
• Track negotiation history and documentation more clearly.
• Support faster communication between clients and underwriters.
• Improve renewal planning and reporting.
• Strengthen audit trails and operational oversight.
• Use analytics to understand market appetite and placement strategy.

Independent brokers do not usually win business on cost alone. They compete on expertise, responsiveness, relationships and the ability to navigate specialist markets intelligently. The right technology helps them spend less time managing process friction and more time advising clients, designing coverage and securing capacity.

Better data, better submissions

One of the most important technology issues in specialty insurance is data quality. Underwriters cannot assess a risk properly if the information is incomplete, inconsistent or difficult to interpret. Poor data can slow down responses, create repeated queries, increase the risk of errors and make downstream processing harder. For complex risks, that can affect not only placement, but also accounting, claims and future renewals.

This is why data standards are becoming more important across the insurance and reinsurance market. In 2025, insurance industry standards body ACORD launched its GRLC Generation 2.0 Data Standards for Global Reinsurance & Large Commercial business. These standards support digitalisation from placing to binding, claims and settlement, improving efficiency, interoperability and data quality. (Source: ACORD)

For brokers, better data is not just a technical issue. It is part of good client advocacy. A well-prepared submission helps underwriters understand the risk more quickly and gives clients a better chance of receiving informed, competitive responses.

AI, governance and the changing insurance market

Artificial intelligence (AI) is becoming a major topic across insurance, but its adoption needs to be treated carefully. For Lloyd’s market participants, the key issue is not simply whether AI can make processes faster. It is whether AI can be used safely, transparently and within a clear governance framework.

That means firms need to think carefully about issues such as confidentiality, data protection, intellectual property, bias, explainability, accountability and human oversight. These are especially important in specialty insurance, where decisions may involve complex risk information, sensitive client data and significant financial exposure.

In April 2026, the Lloyd’s Market Association (LMA) launched an AI Adoption Toolkit to support governance-led implementation across the Lloyd’s market. The toolkit includes practical guidance on areas such as risk tiering, data protection, security, intellectual property, training and accountability. (Source: LMA)

For brokers, insurers, MGAs and InsurTechs, the broader point is clear: AI may become part of the wider insurance technology landscape, but it should not be treated as a shortcut around expertise, compliance or professional judgement. Any use of AI in the Lloyd’s market needs to be responsible, well-governed and subject to appropriate human control.

Operational resilience and cyber risk

Greater use of technology also creates greater operational dependency. If systems fail, communications are disrupted or a cyber incident affects a key market participant, the impact can be significant.

Lloyd’s emphasises operational resilience as a strategic priority. In 2025, Lloyd’s conducted a Market Wide Scenario Exercise to test this resilience. This simulated a broker outage triggered by a cyber incident compromising internal systems. The scenario involved the broker being safely disconnected from Lloyd’s systems to prevent malware spreading. (Source: Lloyd’s)

This highlights that technology is not just about speed and convenience. It is also about resilience. Brokers and market participants need secure communications, business continuity planning, robust supplier oversight, incident response procedures and clear fallbacks if systems become unavailable.

For clients, this matters because insurance is often most valuable when things are already under stress. You need brokers and partners who can continue to communicate, advise and act when market conditions or operational events become difficult.

Innovation and the InsurTech ecosystem

Lloyd’s continues to be a major centre for InsurTech innovation. Lloyd’s Lab is an accelerator programme designed to help innovative ideas gain traction in the market, giving technology businesses access to experienced insurance professionals and the world’s specialty insurance market.

Recent Lloyd’s Lab cohorts have included themes such as operational efficiency within the Lloyd’s market, new insurance products and resilience-focused innovation. Alumni from the programme have collectively raised more than USD $1.7bn in investment and generated USD $359m in gross written premium, while 97% of alumni remain actively trading within the Lloyd’s market. (Source: Lloyd’s)

For MGAs and InsurTechs, this shows why Lloyd’s is important. It is not only a marketplace for capacity; it is also an ecosystem where new ideas in underwriting, data, distribution, analytics and risk management can be tested and developed.

Technology benefits for Lloyd’s market participants

Used well, technology can help address many of the day-to-day challenges facing Lloyd’s market participants. It can support:

• Speed: faster information gathering, communication and response handling.
• Accuracy: cleaner data, fewer errors and stronger documentation.
• Transparency: clearer audit trails, renewal tracking and client reporting.
• Resilience: better preparation for outages, cyber incidents and operational disruption.
• Scalability: growth without simply adding more manual administration.
• Market access: stronger presentation of complex risks to suitable underwriters.

But technology by itself does not solve a placement challenge. A poor submission does not become strong simply because it is delivered through a modern system. A complex risk still needs to be explained properly. Market appetite still needs to be understood. Coverage still needs to be negotiated by people who know the class, the underwriters and the commercial realities.

How to get the best from technology in the Lloyd’s market

To get the full benefit of insurance technology, while still drawing on market experience and strong relationships, you need the right partner. Costero Brokers combines Lloyd’s market expertise with practical understanding of how technology now shapes specialty insurance. As an independent Lloyd’s broker, Costero can help you prepare risk information clearly, approach suitable markets, communicate effectively with underwriters and navigate the processes that sit around modern placement.

For brokers, insurers, MGAs and InsurTechs, that support can be valuable at multiple stages of the insurance lifecycle:

• Assessing whether Lloyd’s is the right route to market.
• Structuring a clear and credible submission.
• Understanding data and documentation expectations.
• Engaging with appropriate market participants.
• Supporting efficient communication through the placement process.
• Helping you combine specialty market access with modern working practices.
• Streamlining claims, reporting and client service.

The best results in the Lloyd’s market still come from combining human expertise with efficient execution. Technology can improve the process, but relationships, judgement and specialist knowledge remain central.

To discuss how technology, data quality and specialist Lloyd’s market access can support your placement, operational or growth objectives, contact Costero Brokers and speak to our experts.

The global insurance market in Q1 2026 has been shaped by multiple factors, including economic uncertainty, softer pricing in several classes, continued catastrophe pressure and renewed geopolitical disruption.

For brokers, MGAs, insurers and insurtechs worldwide, this first quarter of 2026 has brought more available capacity in many areas, but no meaningful reduction in underlying risk. Conditions may be easing in parts of the market, but disciplined underwriting, specialist placement strategy and careful portfolio management remain essential. As we navigate an ever-evolving insurance landscape, this report provides a concise overview of key trends and developments shaping the global insurance market today.

The UK and Global Economy

• UK growth remains subdued: The UK entered 2026 with limited momentum. GDP was flat in January, while GDP over the three months to January was estimated to have grown by 0.2% versus the previous three months, reinforcing the sense of a slow-growth environment rather than a clear recovery. (Sources: ONS, Bank of England)
• Inflation and rates still matter: UK inflation eased from its earlier peak, but remained above target and vulnerable to renewed energy-related pressure. In March 2026, the Bank of England held Bank Rate at 3.75%, signalling continued caution. (Sources: Bank of England, ONS)
• The US remains steady but cautious: The Federal Reserve held the federal funds target range at 3.50% to 3.75% in March 2026, reflecting a more stable but still uncertain backdrop. For the insurance market, that means the familiar balance continues: improved investment returns on one side, with persistent uncertainty around growth, financing conditions and long-tail loss trends on the other. (Sources: Federal Reserve, Reuters)
• Global resilience remains fragile: The IMF projected global growth of 3.3% for 2026 in its January 2026 World Economic Outlook update, suggesting a stable baseline at the start of the year. Even so, Q1 2026 showed how quickly energy, shipping and geopolitical shocks can unsettle that picture, with direct implications for trade, inflation and insured risk. (Source: IMF)

Insurance Industry Developments

• Commercial pricing continues to soften: The broad direction of travel remained favourable for buyers. Global commercial insurance rates fell 4% in Q4 2025, the sixth consecutive quarterly decline, indicating a softer market heading into 2026. Property, financial lines and cyber have all seen more competition in many placements. (Source: Marsh)
• Discipline remains intact: Softer conditions should not be confused with indiscriminate appetite. Accounts with poor loss histories, weak data, accumulation concerns or complex exposures still face scrutiny. The market is more competitive, but still selective, especially on distressed or harder-to-model risks. (Sources: Reuters, Marsh)
• UK conduct issues remain commercially relevant: The UK Financial Conduct Authority says people who pay monthly for insurance are saving a total of around GBP £157 million a year as premium-finance costs fall. That is a regulatory story, but also a commercial one: affordability, fair value and instalment pricing remain live issues for distributors and carriers serving retail and SME clients. (Source: FCA)
• Lloyd’s is prioritising practical modernisation: Lloyd’s of London reported strong 2025 results while signalling a more incremental approach to market reform, after stepping back from its original single-platform Blueprint Two vision in favour of interoperable, practical change. For brokers, MGAs and insurtechs, that suggests continued digital progress, but with more emphasis on workable solutions and less on one centralised transformation vision. (Sources: Lloyd’s, The Times)

Underwriting Performance

• Lloyd’s remains strongly profitable: Lloyd’s of London reported profit before tax of GBP £10.6 billion for 2025, gross written premium of GBP £57.9 billion and a combined ratio of 87.6%. Those are strong results by historic standards and confirm that underwriting and investment performance remain supportive. (Source: Lloyd’s)
• Underlying trends need watching: Strong headline profitability does not mean every margin is improving. Lloyd’s of London’s underlying combined ratio moved to 81.8%, which is still healthy. As pricing eases, sustaining that level of performance is likely to depend increasingly on underwriting discipline and portfolio management. The market remains profitable, but less forgiving. (Source: Lloyd’s)
• Differentiation is increasing across carriers: Other major insurers also posted solid recent underwriting metrics. Zurich reported a 92.6% P&C combined ratio for 2025, while Travelers reported an 82.2% underlying combined ratio for the fourth quarter of 2025. The common theme is that strong results are still being achieved, but increasingly by carriers with tighter risk selection, better data and stronger control of accumulation and severity trends. (Sources: Reuters [1], [2])

Tech, Cyber and AI Developments

• Cyber remains competitive but exposed: Industry cyber rates fell 7% globally in Q4 2025, continuing the pattern of pricing relief seen through much of the past year. Yet the underlying threat environment remains serious, with ransomware, cloud dependency, third-party concentration and systemic accumulation still central to underwriting. (Source: Marsh)
• Digital incidents still create real-world losses: A March 2026 cyber attack on US medical device maker Stryker disrupted order processing, manufacturing and shipments. That is a useful reminder that cyber risk is no longer confined to data compromise or extortion; it increasingly has physical, operational and supply-chain consequences relevant to property, BI and liability discussions as well. (Source: Reuters)
• AI is becoming an insurance issue, not just a technology issue: In Q1 2026, the UK Financial Conduct Authority confirmed new operational-incident and third-party reporting rules to strengthen resilience, while also launching the Mills Review on the long-term impact of AI in retail financial services. Alongside wider UK government work on AI and copyright, this points to growing focus on governance, model risk, resilience, liability and wording clarity. (Sources: FCA, UK Government)

Reinsurance Market

• January renewals confirmed a softer trend: The 1 January renewals showed materially improved conditions for buyers in many property catastrophe placements. Risk-adjusted global property-catastrophe reinsurance rates-on-line fell by 14.7% on average, with retrocession down 16.5%. That marks a clear easing from the recent hard-market peak, even though terms remain firmer than in the pre-2023 environment. (Sources: Howden [1], [2])
• Reinsurer profitability remains solid: Softer pricing has not eliminated strong earnings. Ratings agency Fitch reports that reinsurance renewals are likely to keep softening, but that profits should remain solid in 2026. Better capital positions and improved earnings have given reinsurers room to compete, though discipline remains visible where structures are complex or exposures difficult to model. (Source: Fitch Ratings)
• Specialist gaps still need specialist solutions: Better headline conditions do not mean every risk is easy to place. Cyber accumulation, marine war, political violence, non-damage BI and other tail risks still require careful structuring and access to specialist markets. For cedants and brokers, this is still a market where expertise makes a material difference. (Sources: Fitch Ratings, Howden)

Natural Catastrophes

• Catastrophe losses remain high: Munich Re estimated global insured natural catastrophe losses at USD $108 billion for 2025, while Swiss Re put the figure at USD $107 billion. That reinforces a now-familiar pattern: annual insured nat-cat losses above USD $100 billion are no longer exceptional, with secondary perils continuing to drive a large share of activity. (Sources: Munich Re, Swiss Re)
• 2026 is unlikely to offer much relief: Reuters reported that Swiss Re expects insured nat-cat losses to rise to around USD $148 billion in 2026, with significantly worse downside scenarios possible. For the market, that keeps pressure on aggregate management, pricing adequacy and the search for more flexible protection solutions. (Source: Reuters)

Geopolitical Risks

• Middle East tensions have pushed marine risk back to the fore: Q1 2026 ends with renewed concern around Iran, the Persian Gulf and shipping through the Strait of Hormuz. The Lloyd’s market has been engaging with the US government on maritime contingency planning, while Chubb launched a war-risk facility to support ships transiting Hormuz. This has obvious implications for marine hull, cargo and liability cover, especially where standard policies restrict conflict-related exposures. (Sources: Reuters [1], [2])
• The effects go well beyond marine: Disruption in the Persian Gulf also affects energy, trade, sanctions compliance, contingency planning and cyber risk. Around 20% of global oil supply normally passes through Hormuz, underlining how quickly a regional conflict can become a wider insurance and reinsurance issue. (Source: Reuters)

Looking ahead: Market needs and industry opportunities

Several insurance industry gaps remain obvious: This first quarter of 2026 reinforced the need for better solutions around cyber-physical loss, AI-related liability, supply-chain interruption, political violence, nat-cat protection gaps and other risks that do not fit neatly within legacy policy structures. Capacity exists, but in several of these areas product development and market coordination still lag behind client needs.

The market opportunity is in smarter, more integrated solutions: As cyber, physical, geopolitical and climate risks become more interconnected, insureds increasingly need joined-up advice and flexible structures rather than siloed products. That highlights the benefit of partnering with a specialist broker able to access both London market and wider global capacity for complex placements.

What this means for you and your clients

If you would like to discuss what these developments could mean for your placement strategy, renewal planning or access to specialist capacity in 2026, please get in touch with Costero Brokers or explore more insights on our website.

Disclaimer:

This market report was developed for reference only, and any prospective statements about possible future events or performance are based on developing factors regarding economic and business activity relevant to financial and insurance markets. Such prospective statements involve risk as actual results may differ materially from those expressed or implied due to future changes in relevant factors. We are not responsible for the accuracy of the third-party information cited herein and undertake no obligation to update any such data or prospective statements, nor do we in any way intend to provide legal, financial, or insurance advice regarding any existing or future litigation or other matter discussed or projected herein. Please seek the advice of your own professional advisors or counsel regarding your specific circumstances.

Learn how to find the right marine and cargo insurance in a time of global challenges – and why Lloyd’s of London has a vital role.

When geopolitical tensions flare around major shipping lanes, the impact is felt far beyond the immediate conflict zone. Cargo can be delayed, rerouted or stranded. Vessels and crews can face heightened exposure. Insurance can become more complex overnight. Recent disruption around Iran, the Persian Gulf and the Strait of Hormuz has brought these realities into sharp focus, but the underlying issues are not new and they are not going away.

For insurers, brokers, ship-owners and organisations moving goods internationally, the real question is how to secure robust, responsive marine and cargo protection, even when conditions change. That is where a specialist Lloyd’s broker such as Costero Brokers can make a material difference. Drawing on Lloyd’s of London and international markets, Costero delivers tailored solutions for hard-to-place risks and complex marine and cargo exposures.

The Gulf conflict underlines global marine vulnerabilities

Recent events in and around the Persian Gulf show how quickly marine operations can come under pressure. Conflict escalation in the region has disrupted shipping flows through the Strait of Hormuz, with ripple effects extending into energy markets, maritime transport and global supply chains. The Strait is a critical chokepoint for global trade, carrying around one quarter of seaborne oil trade and a significant share of wider maritime commerce. (Source: UNCTAD)

Even for organisations with no direct exposure to Iran or Gulf ports, disruption in such a corridor can have real consequences, including:

• Longer voyage routes.
• Port congestion.
• Delays and missed delivery windows.
• Rising freight and operating costs.
• Tighter insurance terms.
• Increased need for war-risk and related cover.

A conflict-related incident rarely affects only one vessel or one shipment. It can trigger a chain of consequences involving voyage deviation, cargo deterioration, detention, crew welfare concerns, contractual disputes, and urgent changes to insurance arrangements.

At such times, specialist marine and cargo insurance broking is critical – when risks are difficult to place, conditions are changing quickly, and clients need practical solutions rather than generic cover.

The wider view: Marine cargo risk is broader than conflict alone

The recent Gulf situation is a timely reminder of a wider truth. Conflict is only one part of the marine risk picture. Shipping and cargo businesses are also facing growing pressure from factors such as climate change, extreme weather and cyber threats.

1. Geopolitical conflict

Conflict can affect shipping far beyond active war zones. It can create uncertainty over routes, trading partners, sanctions, security arrangements and insurability. For cargo owners and vessel operators, that can mean a sudden reassessment of risk, both operationally and financially.

2. Climate change and extreme weather

Climate-related disruption is becoming a regular feature of global trade. Droughts, extreme weather and climate-related events are affecting shipping routes and creating volatility in maritime transport. Weather-related disruption can affect ports, delay cargo, increase storage times and lead to damage or deterioration. (Source: UNCTAD)

Climate-related marine and cargo risks include:

• Storms disrupting sailings and port operations.
• Flooding affecting port infrastructure and warehousing.
• Heatwaves damaging temperature-sensitive cargo.
• Drought affecting navigability and inland shipping connections.

3. Emerging cyber attacks

Cyber risk is now an operational marine risk, not just an IT issue. The International Maritime Organization (IMO) has made clear that cyber threats must be incorporated into maritime risk management. A cyber event can disrupt navigation, communications, terminal systems and cargo-handling operations, with direct physical and financial consequences. (Source: IMO)

Potential marine and cargo impacts of cyber attacks include:

• Vessel operational disruption.
• Delayed or immobilised cargo.
• Port and terminal shutdowns.
• Compromised onboard or shore-based systems.
• Liability and business interruption losses.

Marine and cargo insurance must be built around real-world exposures

In this environment, marine and cargo insurance should be structured as a solution, not bought as a commodity. Depending on your exposure, you may need a combination of:

• Marine cargo insurance
• Hull and machinery cover
• War risks insurance
• Loss of hire cover
• Liability protection
• Delay-related extensions
• Stock throughput insurance
• Specialist claims support

You may also need policy wordings that reflect:

• Sanctions considerations
• Rerouting or voyage deviation
• Transhipment exposures
• Cargo accumulation risks
• Cyber-physical loss scenarios
• Changing port and route conditions

When conditions tighten, the difference between a policy that looks adequate and one that genuinely responds can be significant.

Why Lloyd’s is the market for complex marine risks

Lloyd’s of London remains the market that brokers and insureds worldwide turn to when marine risks become more complex. Lloyd’s describes itself as the world’s leading insurance and reinsurance marketplace, providing specialist insurance services in more than 200 countries and territories. That international reach matters in marine because exposures are often multi-jurisdictional and rarely fit a one-size-fits-all model. (Source: Lloyd’s)

Lloyd’s is particularly well suited to complex marine and cargo challenges because it offers:

• Deep specialist underwriting expertise.
• Strong marine heritage and market knowledge.
• Access to subscription capacity across syndicates.
• Flexibility for tailored and layered solutions.
• A global claims infrastructure, including the Lloyd’s Agency Network.

For difficult placements, Lloyd’s can often provide the flexibility, specialism and capacity that standard markets cannot.

Why choosing the right Lloyd’s broker matters

Lloyd’s is not a self-service market. Access, presentation and execution all matter. Lloyd’s itself states that Lloyd’s-registered brokers are experts in their fields and provide efficient, direct access to the specialist market.

If you are an insurer, broker, ship-owner or organisation shipping cargo by sea, land or air, you need a partner that can help you:

• Present your risk clearly and credibly.
• Structure the placement effectively.
• Negotiate the right terms and conditions.
• Secure appropriate capacity.
• Respond quickly as exposures change.
• Support you properly when a claim arises.

A strong Lloyd’s broker does much more than take a submission to market. They help shape the underwriting story, identify the pressure points, and build a programme that reflects how your business actually operates.

How Costero Brokers adds value

This is where Costero Brokers makes the difference. As an independent Lloyd’s-registered broker, Costero provides bespoke insurance and reinsurance solutions for clients in the marine and cargo transportation sector, working closely with Lloyd’s of London and international reinsurance markets. Our focus is on tailored, comprehensive and competitively priced cover, especially where risks are complex or difficult to place.

Costero also brings value through:

• Expertise in geopolitical conflict and war-related insurance.
• Access to specialist Lloyd’s and global reinsurance capacity.
• Tailored underwriting support for challenging marine risks.
• Practical knowledge of cargo, vessel and operational exposures.
• An efficient and responsive in-house claims service.

We specialise in handling hard-to-place marine risks that need in-depth experience, swift decisions and strong market relationships.

In a volatile world, marine insurance expertise matters

Marine and cargo risk is becoming more and more complex. Regional conflicts, weather volatility and cyber disruption are all adding pressure to global trade and transportation. The organisations best placed to respond will be those that prepare early, structure cover carefully and work with specialists who understand how to navigate the market when conditions change.

If you are looking for a marine and cargo insurance partner that can help you secure tailored, responsive and comprehensive protection, Costero Brokers can help. We work closely with Lloyd’s of London and international reinsurance markets to create solutions based around your routes, assets, cargoes and risk appetite.

Talk to us about your marine and cargo challenges

Whether you are an insurer, broker, ship-owner or organisation moving cargo internationally, the right insurance structure can make all the difference when conditions become more complex.

To learn more about our marine and cargo insurance solutions and discuss your goals, please get in touch with our expert Jack Nicholson at Costero Brokers.