What the Allianz Safety and Shipping Review 2026 Says and What Operators Should Do About It

Every year, Allianz Commercial publishes its Safety and Shipping Review, a data-driven analysis of global shipping loss trends, incident causes, and emerging risk themes drawn from claim data, industry reporting, and their own underwriting experience. This year's edition landed at a moment when the industry is navigating a degree of geopolitical disruption not seen in decades, and the report reflects that context directly. What it also reflects, however, is a more complex and interconnected risk landscape than any single headline can capture. This post works through the key findings and, more importantly, what they mean for shipowners and operators managing real fleets in current conditions.

The Headline: Incidents Are Down, But the Risk Profile Is Getting Harder

The headline statistic from this year's review is encouraging on its face. Reported shipping incidents on vessels over 100GT declined over the past year by around 16%, falling to 2,818 in 2025 compared with 3,353 in 2024. The longer-term picture reinforces this trend. Total losses over the past decade stood at 905 vessels over 100GT. Between 2016 and the end of 2020 there were 555, an average of 111 per year. That number declined to 350 between 2021 and the end of 2025, an average of 70. That's a 37% reduction on the previous five-year period, reflecting the cumulative effect of improved regulation, ship design, and safety management systems.

The danger in reading these numbers in isolation is that they can create complacency. The industry is genuinely getting safer by the metrics that measure traditional operational casualties. What is also true, and what Allianz is explicit about, is that the risk landscape is expanding in ways that traditional incident statistics do not fully capture. Incidents like the closure and reported mining of the Strait of Hormuz signal a transition toward a "new maritime order" defined by escalating security risks along strategic shipping corridors, the disruption of established trade routes, persistent uncertainty, higher risk premiums, and a greater strategic emphasis on resilience over pure cost efficiency. The industry's safety record has improved, but its operating environment has not.

Machinery Damage: The Persistent Operational Reality

Machinery damage or failure was the major cause of all shipping incidents globally during the past year, accounting for over half of all incidents at 1,505, followed by vessel collision at 260 and fire and explosion at 218. This is not a new finding, machinery damage has been the leading incident cause for years, but the context around it has changed in ways that make it more consequential.

Machinery claims inflation has not yet returned to pre-Covid-19 levels, with repair costs having continued to rise, a trend which could be exacerbated by the recent conflict in the Middle East. The combination of elevated repair costs, extended lead times for spare parts, and shortages of skilled labor in major repair hubs means that machinery incidents that might have been routine and cost-contained a decade ago are now generating significantly larger claims. This is a direct driver of hull and machinery premium levels in the current market. Operators who are not actively managing their planned maintenance systems and spare parts inventories are carrying more financial exposure than their P&I and H&M programs may be sized to absorb.

The inflation dynamic is compounded by the aging fleet problem discussed below. Older vessels generate more machinery incidents, and those incidents now cost more to resolve than they did when the vessels were built. The interaction between fleet age and repair cost inflation is one of the more significant underwriting concerns in the current hull market.

Fire: The Second Highest Total in a Decade

Fire remains a major loss driver with over 200 incidents in 2025, the second highest total in a decade. Fire on vessels is not a new risk, but its persistence at elevated levels despite overall incident reduction tells a specific story. The operational controls that have improved performance in other categories have not kept pace with fire risk, and the drivers of that risk are structural rather than incidental.

The primary identified driver continues to be misdeclared cargo. These are goods shipped in containers whose declared nature and packaging do not match their actual contents, including lithium-ion batteries, chemicals, and other hazardous materials that generate fire risk when exposed to the conditions of ocean transit. Technology solutions are now helping shipping companies identify misdeclared or incorrectly labeled cargo. The World Shipping Council and National Cargo Bureau's cargo safety program leverages AI to screen millions of container bookings globally, offering a critical step forward in addressing fire risks in the shipping industry. This is a meaningful development, but the scale of the problem means that technology screening is a supplement to, not a replacement for, carrier due diligence at the booking and acceptance stage.

For operators, the fire risk picture has a specific insurance implication. Fire and explosion is a covered peril under standard H&M and cargo policies, but the circumstances of a fire, particularly where misdeclared cargo is identified as the cause, can give rise to complex subrogation and liability questions between the carrier, the shipper, and the cargo insurer. Carriers who do not have robust cargo acceptance and screening procedures in place are potentially carrying liability exposure that their P&I cover was not designed to absorb indefinitely.

The Aging Fleet: A Structural Problem With Immediate Consequences

The average age of the global shipping fleet reached 23 years in 2025, while vessels more than 20 years old now make up nearly one-quarter of the world's containership fleet. That's the highest share in decades. This is one of the most consequential structural findings in this year's review, and it deserves more attention than it typically receives in commercial discussions focused on freight rates and routing.

The safety data behind the aging fleet finding is stark. Older vessels can pose significant safety risks at sea, with vessels over 20 years old accounting for over half of all safety incidents. As ships age, the likelihood of incidents increases due to structural, mechanical, and technological obsolescence, creating risks for crew, cargo, and the environment.

The drivers of fleet aging are not difficult to identify. Geopolitical volatility and limited shipyard capacity delay fleet renewal, despite shipowners being under pressure to scrap older vessels and replace them with new, more efficient, safer and compliant ships. The regulatory uncertainty around alternative fuels, discussed further below, has compounded this. Operators who are unsure whether to order LNG-capable, methanol-capable, or ammonia-ready vessels have in many cases deferred newbuilding decisions entirely, continuing to operate existing vessels for longer than originally planned.

From an insurance standpoint, the aging fleet dynamic affects both the availability and the cost of hull coverage. Underwriters are increasingly scrutinizing the condition and maintenance history of older vessels, and the appetite for providing broad-form H&M cover on vessels over 20 years old is narrowing in parts of the market. Operators of aging tonnage who have not recently reviewed their hull program, particularly in terms of agreed insured values, which may not reflect current replacement cost or market values, should treat that as an immediate priority.

Geopolitical Risk: $125 Billion Waiting in the Gulf

Allianz estimates that $125 billion in vessel and cargo value awaits passage from the Persian Gulf, a figure that illustrates the commercial magnitude of the Hormuz disruption and the importance of maritime chokepoints to global trade. That number has not materially reduced since the report's publication, given that as of today the ceasefire framework has collapsed and US-Iran exchanges of fire are ongoing. The report was written against the backdrop of the disruption that began in February; the current situation has deteriorated further since its publication.

What Allianz's geopolitical risk commentary adds to the commercial analysis is a longer-term structural argument. The Hormuz crisis is not simply a temporary disruption to be waited out, it represents a broader shift in how maritime risk is distributed globally. The industry is moving toward what Allianz characterizes as a "new maritime order," one in which the assumption of open sea lanes and predictable trade routes that has underpinned maritime commerce for decades can no longer be taken for granted. Machinery failures, aging fleets, repair inflation, geopolitical disruption, alternative fuels and crew competence are not presented as isolated challenges. Instead, Allianz shows how they combine to influence operational resilience, maintenance planning, insurance costs and commercial performance.

Cargo Theft: A Fivefold Increase Since 2022

Allianz notes a fivefold increase in cargo theft losses since late 2022. This is a finding that tends to receive less attention than the headline incident and total loss statistics, but its commercial implications for cargo interests and operators are significant. Cargo theft has evolved well beyond opportunistic pilferage at ports. It increasingly involves sophisticated, organized criminal operations targeting high-value cargo at multiple points in the supply chain, including in-transit theft, warehouse infiltration, and cyber-enabled diversion of cargo through fraudulent documentation.

The insurance implications are direct. Cargo theft losses are covered under cargo policies, but the scope of that cover depends on the specific policy form and any exclusions that apply to particular theft scenarios. Operators and cargo interests who have not recently reviewed whether their cargo policy responds to the full range of modern theft exposures may find gaps that the fivefold increase in losses has made materially more relevant.

Alternative Fuels: The Regulatory Gap

More than half of all container ships on order in 2025 are capable of operating on alternative fuels. However, Allianz warns that regulatory and liability frameworks for fuels such as LNG, methanol, and ammonia continue to lag technological adoption, creating uncertainty for shipowners and insurers alike.

This lag is not a minor technical issue. The regulatory frameworks that govern how incidents involving alternative fuels are handled, including fire suppression protocols, bunkering safety standards, port authority requirements, and cargo compatibility rules, are still catching up with the operational reality of dual-fuel vessels in service. The operation of dual fuels can be more complex than traditional heavy fuel and therefore can be more susceptible to claims activity such as machinery breakdowns if crews have not had sufficient training or are unfamiliar with necessary procedures.

For operators ordering or operating dual-fuel vessels, the training and familiarization dimension of this risk is as important as the technical specification of the vessel itself. An LNG-capable vessel operated by a crew that has not been adequately trained in its specific operational requirements is a claims exposure that existing H&M and P&I coverage structures were not designed around. Engaging with your insurers and P&I club on the specific coverage position for dual-fuel operations before a claim arises is a material operational priority.

Crew Abandonment: Six Consecutive Years of Increase

Allianz reports that crew abandonment has now increased for six consecutive years, reaching a record high. Crew abandonment, the situation in which a shipowner ceases to meet their obligations to crew members, leaving them stranded on a vessel without pay, food, or repatriation, is both a humanitarian issue and a P&I liability. It is covered under P&I club rules as a welfare obligation, but the repeated failure of operators to meet those obligations reflects broader financial stress in parts of the fleet and a welfare crisis that the industry has not yet adequately addressed.

The operational dimension of the crew abandonment trend connects to the broader resilience argument running through the review. Prolonged conflict, seafarer abandonment, recruitment pressures and the psychological impact of operating in high-risk regions are presented as business continuity issues as much as welfare concerns. Crew wellbeing is presented not only as a welfare issue but also as an operational resilience challenge affecting the industry's ability to attract and retain skilled personnel. An industry that cannot attract and retain qualified crew is one that will generate more incidents regardless of what the safety statistics say about vessel hardware and maintenance systems.

The Practical Takeaway

The Allianz Safety and Shipping Review 2026 is not a document that generates comfort for operators who read it carefully. The headline numbers on incident reduction are real and meaningful, but they sit inside a risk narrative that is moving in the opposite direction. Older fleets, higher repair costs, unresolved alternative fuel frameworks, escalating cargo theft, record crew abandonment, and the geopolitical environment have fundamentally disrupted the assumption of open sea lanes.

The practical response for operators is not to panic but to audit. Review your H&M agreed values against current replacement costs and market values, particularly for vessels over 15 years old. Review your cargo acceptance and screening procedures in the context of fire risk driven by misdeclared cargo. Review your cargo policy for coverage of modern theft scenarios. Engage your P&I club on crew welfare obligations and the coverage position for dual-fuel operations if you are transitioning to alternative fuels. And review your war risk program in light of the current Gulf situation, which has deteriorated since this report was written.

The operators who treat the Allianz review as an action document rather than a reading exercise are the ones who will be better positioned when the next incident, whether mechanical, geopolitical, or otherwise, arrives.

[Source (download the full report here): https://commercial.allianz.com/news-and-insights/reports/shipping-safety.html]