“Perfect Storm” Results in Most Challenging P&I Renewal

Press Release
Thursday, December 13, 2012

The upcoming Protection and Indemnity (P&I) renewal is poised to be the most challenging in a decade as a result of difficult economic conditions for ship operators, poor underwriting results and some of the largest claims in history, according to Willis Global Marine, a division of Willis Group Holdings plc (WSH:NYSE), the global insurance broker, in its annual P&I Market Review.


The P&I market results last year (2011/12) showed a 13% increase in incurred claims, a 5.9% underwriting loss and only a 2.7% investment return. Total market free reserves increased marginally (4%) but tonnage increased by 9% over the same period. The market is therefore larger, but proportionately slightly weaker than the previous reporting period.


Against this backdrop, 2011/12 has the dubious honour of registering the highest level of net paid and net incurred claims ever reported by the P&I market (2% and 8% higher than the previous record level in 2009/10).


Added to that, 10 out of the 13 P&I clubs reported underwriting losses. On a financial year basis in 2011/12, the largest individual P&I club combined ratio was 120%, the lowest was 85%. Neither of these extremes of underwriting deficit or surplus (respectively) should be sustainable in a mutual environment.


“With pressure on all sides, the 2013 renewal will likely present some of the hardest fought negotiations since the turn of the century,” explained Ben Abraham, Global P&I Practice Leader in Willis Marine and author of the P&I Market Review.


“It is self-evident that ship operators are facing one of the most challenging economic periods in a generation. It is similarly obvious that the P&I market is not balancing its underwriting results. Added to this, the reinsurance market has been presented with the largest and third largest claims in the history of the International Group (IG). The final contributing factor to this ‘confluence of events’ is a fragile and lacklustre investment market that is likely to allow only meagre returns.”


He continued: “In such a challenging renewal environment, the choice of specialist broker is critical to ensure that best value is achieved from this unique market.”

Maritime Reporter September 2014 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

BHP Bullish on Caval Ridge's Prospects

Yesterday BHP Billiton Coal President, Dean Dalla Valle, was joined by the Hon. Tony Abbott MP, Prime Minister of Australia, and joint venture partner Mitsubishi in a ceremony to open the US$3.

Vice Presidents Rejig at Caterpillar Inc

Following the previous announcement regarding two group presidents’ retirements and new responsibilities for another group president, Caterpillar Inc. (NYSE: CAT)

Keppel Logistics Expands in Australia

Keppel Logistics Pte Ltd, a wholly owned subsidiary of Keppel Telecommunications & Transportation Ltd (Keppel T&T), has expanded its logistics capabilities down

Finance

Maduro Says Venezuela's 2015 Budget to Put Oil at $60

Venezuela's 2015 budget will be based on a target oil price of $60 dollars per barrel, President Nicolas Maduro said on Friday night, but he repeated expectations that prices will recover.

No Merger of Yara & CF Industrie

Yara International ASA and CF Industries have terminated their discussions regarding a potential merger of equals transaction. "This has been a constructive process,

Hurricane Ana Heads towards Hawaii

Tropical Storm Ana strengthened into a hurricane on Friday and was moving in the direction of Hawaii but was not expected to make a direct hit on the islands, the U.

Casualties

Simushir Under Tow by Barbara Foss

Foss Maritime's ocean-going tug, the Barbara Foss, is towing the Russian cargo vessel, Simushir, which lost power late Thursday night off the west coast of Haida Gwaii.

USCG Search For Boater Missing 50 miles South St Marks, Florida

The Coast Guard is searching for a missing boater 50-miles south of St. Marks, Florida, Sunday. Missing is George Taylor, 60, from Tallahassee, Florida, who

Saudi Oil Pipeline Set Alight

A "limited fire" broke out on a subsidiary oil pipeline in eastern Saudi Arabia on Saturday after assailants fired shots at a security patrol, the state news agency SPA said.

News

Autonomous Technology for Offshore Wind Farm

ASV Ltd in association with Planet Ocean Ltd, have received funding from the GROW:OffshoreWind initiative to investigate how the use of Autonomous Surface Vehicles

BHP Bullish on Caval Ridge's Prospects

Yesterday BHP Billiton Coal President, Dean Dalla Valle, was joined by the Hon. Tony Abbott MP, Prime Minister of Australia, and joint venture partner Mitsubishi in a ceremony to open the US$3.

India to Develop Iran's Chabahar Port

India will float a company to develop Iran's Chabahar Port, a government statement said on Saturday, as New Delhi aims to take advantage of a thaw in Tehran's relations with world powers.

 
 
Maritime Contracts Maritime Standards Naval Architecture Pipelines Port Authority Salvage Ship Electronics Ship Simulators Shipbuilding / Vessel Construction Sonar
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1870 sec (5 req/sec)