Success of Somali pirates has spurred increased risk: Willis

Somali pirates’ tactics have evolved to become more sophisticated and violent, including increased ransoms and hijacking periods, warns Willis’s Special Contingency Risks Limited (SCR) and the Maritime and Underwater Security Consultants (MUSC).
An estimated $65 million has been paid in ransoms to pirate gangs in 2011 Q1. In comparison, approximately $39 million in ransoms were paid in 2009, a Willis release says.
Currently, 18 commercial vessels and roughly 500 hostages are being held. For the first time, hostages have been executed, with five killed so far in 2011.
The pirates have evolved their tactics and expanded their volume and range of activity in the Arabian Sea and the Indian Ocean, Willis notes. These new dynamics include:
•using commercial vessels as floating bases from which to launch attacks;
•a new, more aggressive generation of practitioners drawn from criminal gangs and neighbouring countries in the Horn of Africa; and
•an increase in average ransom (from $2.1 million in 2009 to $4.6 million in 2011) and length of time hijacked ships are being held (roughly six months on average, compared to two to three months in 2009).
Insurers are responding by continuing to offer plenty of capacity at relatively consistent rates to shipowners. They are also encouraging better risk management practices by mandating them in policies, said William Miller, divisional director at SCR.
One such practice is protecting a ship with barbed wire, he said.