Premiums in the yachts and pleasure craft market are set to soar following a change in international law that will quadruple limits on liability.
Under the terms of the Athens Convention, which governs aspects of international maritime law for vessels up to 300 tonnes, the limit of third party liability for personal injury and property damage will rise from around £300,000 to £1.8m.
The change will fuel further premium hikes in a market that has already suffered double digit inflation over the past three years.
Poor underwriting, increasing claims culture and changes to building techniques have been blamed for the rise in premiums.
A spokesman for marine insurer Navigators and General said: "There has been a huge increase in liability claims over the past few years.
"In the past people who got a knock would take it as part of the sport. Now they are more likely to sue."
The underwriter estimates the change in law, due to be introduced in June, will add an additional 10% to premium inflation.
