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October 2020 / International Group Clubs - 2021 / 22 P&I - FDD Renewals - Part 1

Dear All,

The renewal season of Group Clubs is fast approaching and coincides with this severe pandemic, which continues to affect both human lives and economies globally. The shipping industry, handling the vast majority of global cargo transportation, is not immune, and we continue to see pressure on the supply chain and shipping, including but not limited to, commodity manufacturers, ship owners/operators, their crew, charterers, shippers, insurers and the P&I Clubs. Clubs’ directors and their managers are therefore under even more pressure to carefully monitor underwriting performance, premium income, claims performance and financial investments.

It is important to highlight that a common problem for all Clubs this year has been the high level of Pool claims, which are running at a historically high level. 

To refresh minds, a pool claim is defined as a single claim exceeding $10 million, which is pooled among the 13 Clubs up to $30 million. Any excess is met by the reinsurance of ‘Hydra’ up to $100 million. ‘Hydra’ is a capital reinsurance company formed by the participants of the 13 Group Clubs and is reinsured in the commercial insurance market. Within Hydra’s upper pool reinsurance there is also a further 7.5% ICR (International Club Retention).

Please find below our comparison table for P&I and FDD. The first Club to declare has been Steamship Mutual, who have declared 5% general increase for all classes of insurance.  Further details and changes as to abatement layer, deductibles etc. are mentioned at the attached circular.

The majority of Clubs reflect the group reinsurance cost, once known, in the agreed renewal premiums, but for those Clubs who will not reflect and absorb such change, we will specify as and when declared.

Clubs also assess the individual member performance, according to which the premium and deductible levels will differ, in addition their general announcements will apply.

 

Below you can find our comparison table of Group Clubs.

 

 

2021 / 22

P&I

NOTES

American

   

Britannia

   

Gard

   

Japan

   

London P&I

   

North.O.E.

   

Shipowners

   

Skuld

   

Standard UK

   

Standard Ireland (London Class)

   

Steamship

+ 5 %

No change to deductibles

Swedish

   

U.K.

   

West.O.E.

   
     
     
     

2021 / 22

FDD

NOTES

American

   

Britannia

   

Gard

   

Japan

   

London P&I

   

North.O.E.

   

Shipowners'

   

Skuld

   

Standard UK

   

Standard Ireland

(London Class)

   

Steamship

+5%

the standard FD&D deductible to US$7,500 with the cap on a Member’s maximum contribution increasing to US$50,000.

Swedish

   

U.K Defence

   

West.O.E.