How to protect your cargo from pirates.

It took Pirates of the Caribbean more than a week to earn $100 million at the box office. It took the pirates of the Somalian coast less than a day to seize $100 million worth of crude oil earlier this week. Thar be pirates, indeed.

The pirates’ seizure of the Sirius Star—a Saudi oil tanker carrying 2 million barrels of crude—has laid bare an issue that has long plagued maritime trade: More pirates equal less safety. Somali pirates have claimed 95 vessels this year, far surpassing years prior. The riskier the voyages become, the higher operational costs will be. Insurance plans will start charging higher principles, circumspect routes will be used, and financially burdensome security details may have to be hired. In all, though, consumers won't feel much pain, thanks to the unique economics of sea transport and the security blanket of naval power.

There are three tiers of pirate protection for every vessel. The price is set the same way any other insurance rate is, by a calculation of risk. The ship’s key statistics—size of ship, size of crew, length of journey, transport route, docking port, etc.—are weighed and evaluated.

First, there’s the basic hull insurance, which insures damage to the ship and its cargo from “marine perils.” There’s some debate whether this covers damage incurred from a pirate attack, so there’s another plan—the ominously named “war policy”—that is sure to protect you from violent damage. Just to be safe, there’s also a kidnapping and ransom policy—“K&R” to those in the nautical know—that insures against losses to what the pirates are really after: money. It’s been reported that K&R premiums at one leading insurer, Hiscox, are now 10 times the cost they were a year ago, but Hiscox declined to confirm or deny that number to The Big Money. Brendan Flood, a member of Hiscox’s marine staff, did confirm that “quite clearly rates have gone up” over the last six to nine months. None of the companies TBM interviewed for this story would share hard numbers on how much it costs to take out any of the insurance policies.

These costs have gone up mainly because the voyages in question steam through the Gulf of Aden, which has become a cantina of pirate activity. Via the Suez Canal, Aden is the main waterway for freighter-based trade between Asia and Europe; 20,000-plus ships go through Aden a year. The alternative is not ideal—it’s sailing all the way down the east coast of Africa, around the Cape of Good Hope, and then back up the other side. Analysts told The Big Money that a Cape of Good Hope route would add two to three weeks of travel time (an increase of 30 percent) and hundreds of thousands of dollars of added cost to the endeavor. Complicating matters further, the Sirius Star hijacking took place while the Sirius was traveling not within the Gulf of Aden, but on its way through the Good Hope route. If piracy flourishes along that route, not just Good Hope insurance premiums will go up. So will the hijack count.

And when it comes to pirates, if you can’t avoid them, think about intimidating them. More than a dozen navies have been tasked to the region, but with little to show for their efforts (despite India’s success at cannonballing a pirate mother ship Tuesday). European Union reinforcements are on the way, which should help. But if the situation doesn’t improve soon, shippers are prepared to take things into their own hands.