Piracy Influence on the Shipowners and Insurance Companies

Abstract

Piracy is growing international problem which has strong influence on the shipowners, insurance companies, economic activities of neighbouring countries, whole shipping industry and finally on the whole world economy. Seriousness of the problem is recognized by International Maritime Organisation and many states which are issuing new regulations to enable employment of the armed guards and possibility of armed crew to the shipowners. As a consequence of pirate attacks the shipowners are confronted with the increasing costs. In the paper are defined the direct and secondary costs of piracy for the shipowners. On the other side piracy has strong impact on the maritime insurance industry. In last years insurance premiums for the risk areas are rapidly increasing. In the near future one should be improve the politic and economic situation in Somalia as it is the only way to combat piracy and its intense impact on the maritime industry, consequently whole global economy.