Allianz Australia has warned marine insurance clients to ensure they are adequately covered for piracy after reported incidents in the Gulf of Aden – a major Australian trade route – trebled last year.

The Australian division of Allianz Global Corporate and Specialty (AGCS) says the salient clauses to look out for in marine insurance wordings include acts of war, terrorism exclusions, ship seizure and ransom demands.

AGCS Pacific GM Stefan Feldmann says seaborne piracy against shipping “continues to be a concern for international trade”. Allianz issued the report because “it is often difficult to stay abreast of insurance policies covering piracy,” he said.

The report notes that some UK underwriters have begun a transition from covering piracy under hull policies to war risk policies.

The Asia-Pacific region is likely to follow suit because of its heavy reliance on reinsurance support from the London market.

Hull underwriters of global risks have moved to exclude piracy as an insured peril in some cases, instead offering a reinstatement of cover under a war policy.

Cargo is regarded as a lower piracy risk because containers make it hard for pirates to identify valuable stock.

The total cost of piracy has been estimated at between $US13-16 million ($15-19 million) each year.