Recent market disclosures suggest insured losses from the Baltimore Bridge collapse could exceed $2.8 billion, with Howden Re managing director Hugo Chelton saying the worst impact is likely to fall on major reinsurers and the retrocession market, with losses likely to represent a significant single-event hit relative to their capital base for some players.
“When the container ship Dali struck Baltimore’s Francis Scott Key Bridge in March 2024, early market reserves were at $1.5 billion. This figure became the working assumption for much of the marine and reinsurance market from 2024 to 2025, forming expectations for renewals on January 1, 2026,” Howden Re explains in a new report on the matter.
Since then, however, legal, bailout and reconstruction costs have reportedly been in flux, with the ultimate scale of the damage now coming into clearer focus.
Howden Re cited recent market disclosures showing insured losses totaling more than $2.8 billion, reflecting a wider range of liabilities than initially expected.
“At this level, the Baltimore Bridge would be the largest single marine insured loss on record, surpassing the approximately $1.6 billion insured loss caused by the grounding of the Costa Concordia in 2012. That previous event has been considered the industry’s previous benchmark event,” Howerton explained.
The company said the increase in losses took the market by surprise, with Chelton noting that the scale and speed of the reassessment caught many off guard.
“The news came late on Friday. By Monday morning, it had gained real momentum. A $1.3 billion deterioration would be a significant loss event on its own — let alone on top of what is already one of the largest ocean losses in the market,” Chelton said.
Howden’s report noted that the main driver of the increase is the cost of replacing the bridge itself.
“The settlement framework between the state of Maryland and Chubb, which insured the bridge, accounts for approximately $2.5 billion of the total damages, balanced by pollution liability, debris removal and loss of toll revenue,” the company added.
Howden continued: “At the heart of the settlement is the role of the International Group of P&I Clubs, which is a collective body representing 13 mutual aid societies that jointly insure these types of maritime liability risks. The individual clubs share large claims through the group’s pooling mechanism and significant excess losses reinsurance scheme, enabling them to respond to catastrophic losses of this scale.
“The scale and importance of the international group’s reinsurance business means that outcomes such as Baltimore’s will inevitably have an impact well beyond the primary market.
“The vast majority of the $2.8 billion will be absorbed by the reinsurance and retrocession markets. While some market participants initially anticipated that the $3 billion limit on the International Group reinsurance tower might be required, statutory limits on shipowner liability did not ultimately limit settlements. Most origin carriers will have reinsurance, and aggravation will flow further down the line.”
Chelton continued, “As losses increase, they become increasingly concentrated. The largest exposures are to large reinsurers and the retro market. For some players, this will be a very significant single loss relative to their own capital base.”
Howden Re said elsewhere in the report that despite the size of Baltimore’s losses, its market was already managing greater overall risk. Marine, energy and terrorism portfolios reportedly coexist with periods of peak natural disaster risk, particularly US storms.
“Carriers with offshore responsibilities are also exposed to the risk of hurricanes. In this case, the really serious event is the $100 billion in natural losses. The $2.8 billion in offshore losses is significant for this type of loss, but it must be considered in the broader portfolio decisions these carriers are making,” Chelton explained.
Howden Re’s report notes that marine liability insurance and reinsurance are almost certain to see rate increases. It also highlighted that settlements over aviation lease losses for many of the same airlines were adding to pressure, while losses from conflicts in the Middle East were mounting.
Chelton continued, “Overall, the cumulative effect makes sense. Something has to give. Offshore liability rates will rise. Whether this will translate into a broader market correction is less clear.”
The Howden Re report looks at capital as a key balancing factor. In the marine, energy and terror sectors, capacity continues to exceed demand, with multiple sources estimating available limits to be multiples of the technical requirements for many large energy and infrastructure risks.
The report noted that at renewal in April 2026, despite continued loss-making activity, pricing softened by 15-20% in some markets as new entrants absorbed known risks with little adjustment.
Suffering carriers are said to have reassessed their appetites, but new capital continues to enter the market, maintaining competitive pressure on pricing and firmly maintaining the balance of negotiating power with buyers.
“The market is experiencing a complex set of signals. Losses of this magnitude do change thinking over time and we are seeing the early stages of this. The question for clients is how to position themselves ahead of this shift rather than react to it,” Chelton concluded.
