Maritime Insurance

P&I club warns of steeper premiums

NORTH of England marine mutual has added its voice to early warnings from other protection and indemnity clubs that members should brace themselves for a further rise in premiums in 2009.

The Newcastle-based P&I Club, nofollowing approval of its 2007 accounts, said rising claims costs and volatile investments markets will spell another round of steep general increases.

North of England in February called on members for a mandatory pool surcharge of 7.5% alongside a 10% general increase in premiums for 2008.

One note of good news amid “difficult” conditions for the North of England is that the free reserves have continued to grow, up to $220m from $190m a year earlier.

Fellow mutuals Britannia, Steamship, Skuld, and Gard all enjoyed an increase in funds remaining after liabilities, although the UK P&I Club earlier this month posted a $34m reduction in free reserves from a year earlier, to $229m.

North of England has also reported investment income and exchange gains of $40m, which offset a technical underwriting loss of $10m.

Although the increased level of claims in 2007 also triggered a net underwriting loss, a reduction of its equity exposure last year to 17% from 38% kept returns from investment at 7.1%.

North of England joint deputy managing director Alan Wilson, said: “The industry continues to face a difficult claims environment and investment markets are particularly volatile, suggesting the need for further industry-wide premium increases.”

The club’s entered tonnage now stands at more than 90m gt, with owned tonnage in excess of 65m gt and chartered ships accounting for around 25m gt.

Members also continued to add ships, resulting in a total annual growth of nearly 10m gt owned tonnage and 10m gt chartered tonnage.

North of England managing director, Rodney Eccleston, said: “The board is acutely aware of the need to maintain service levels so has approved the recruitment of additional staff.”

North of England has also confirmed that 52-year-old Mr Wilson and fellow deputy Paul Jennings, 45, will be promoted to joint managing directors when Mr Eccleston retires in September 2009.

The club was previously under the joint leadership of Mr Eccleston and Peter Crichton for 18 years until May 2006, when Mr Crichton retired.

The club has enjoyed a Standard and Poor’s ‘A’ rating for the past four years, for its strong operating performance.

• A balancing act between arbitrators and judges
• A case of the confectioner urging us to eat more sweets
• Acquiring a subtle taste for China’s business
• Allianz Deutschland happy with profits rise
• American chief: clubs must explain true value
• Amlin marine premiums slip
• Another sort of surge
• Aon warns of Venezuela ‘risk’
• Back-to-back on insurance
• Boskalis chief slams London insurance market

• < Prev
• Next >