The eyes of the yachting world are trained on The Americas Cup in Bermuda.
As the competition website puts it: “The eyes of the world will turn to the iconic Great Sound where the best sailors on the fastest boats will battle for the oldest trophy in international sport.”
Not only has this spectacular event captured the public’s imagination, it’s also been responsible for a revolution in yacht design that is beginning to have a profound impact on yacht and marine insurance.
Four years ago the yachting world watched in awe as the first racing catamarans with foils appeared and took yacht racing to a new level. You can see them in action here.
Only keen yacht enthusiasts are likely to have fully understood the significance of an announcement late last year by Beneteau, one of the world’s leading racing yacht designers and builders.
The news that it was putting into full production a monohull racing yacht, with foils, meant that new technology, designed for the crème de la crème of the sailing world, was finally filtering down into the wider yachting world.
It wasn’t a huge surprise for Keith Lovett, as well as being a keen yachtsman, he’s senior underwriter who also works on product development for MS Amlin’s yacht and marine team.
When Keith and his colleagues saw the new technology in action, they anticipated correctly that it wouldn’t be long before it became available to a wider market.
“Technology has moved forward rapidly in the last two years, primarily driven by the big catamarans,” says Keith. “We could see straight away that this was going to have an impact on our business.
“That’s because the risks are relatively unknown. With traditional boat building, which for many years has been dominated by fibreglass hulls, you have plenty of historical data to base your judgement on.
“But this is all new. But we’re putting our time into understanding it better.”
Yacht design has come a long way since the 1960s when wooden hulls gave way to fibreglass.
“Now we have modern ‘exotic materials’, mainly carbon derivatives, which have transformed the way boats are built,” added Keith.
“If you’re in the business of insuring these vessels you have to stay ahead of the curve. In some boats you don’t even have a solid hull any more, exotic materials are stretched over a frame.”
And in terms of the speed of change, The America’s Cup has been a game-changer. It’s a highly competitive, prestigious event that attracts millions of pounds of investment and sponsorship.
As the race to build ever-faster racing vessels hots up, those millions of pounds are going into research and design. Experts from the automotive and aeronautic industries have been drafted in to refine and develop new technologies at a faster pace than would normally have been the case.
It's meant a step-change in the speed of development.
“The heightened interest in the Americas Cup delivered the impetus for technology to move forward faster than it would normally have done,” says Keith.
“And about three years ago we realised that it was inevitable that this technology was soon going to be available to the wider yachting community. Now the first production racing yachts are coming on to the market, it’s going to move into cruising yachts in the not too distant future.”
The MS Amlin team are ideally placed to be at the forefront of understanding the implications for yacht insurance, not least because they’re nearly all yachting enthusiasts themselves.
As one of the leading yacht insurers they have one of the most experienced teams around.
So they have spent the last three years, using their extensive industry contacts to understand how technology might develop and what the impact might be.
“We have very close relationships with yacht builders, designers, marine surveyors and racing teams. This means we have unique insights into how the future might look.
“We were one of the first to spot from a very early stage that foils can result in higher shock loads, which of course affects how we assess the risk of insuring these types of vessels.”
Keith added: “We set out to use all our contacts and relationships to stay at the leading edge.
“We have spent hours and hours on research to try and fully understand what was going on with yacht design.
“By using our contacts in top level yacht races we could get a much better understanding of the risks and rewards.
“Sailing enthusiasts follow these high-profile races and wanted a piece of the action. It’s fun, fast, looks good and in terms of racing can give you a cutting edge.
“A lot of our underwriters love sailing. It helps a lot when you share the passion and enthusiasm of the people you’re doing business with.”
MS Amlin is title sponsor of the annual Bermuda Moth Regatta. Some of the same sailors who competed individually in the Moth class races will now be racing in The America’s Cup.
You can read more here.