London Club Sets Increase for P&I
THE London P&I Club has set a general increase of five per cent in annual P&I call rates for the 2012/2013 policy year.
Commenting on the background to the decision, Ian Gooch, chief executive of the club’s management team, says, “Prior open policy years are developing in line with expectations. In the current year the news is conflicting. On the one hand, we have seen some signs of increased claims activity, mainly involving cargo cases in the $100,000-$1m band. But at the same time we are finding that claims above that band, as well as at the attritional level, are currently running at lower levels than at the same stage in the two prior policy years. International Group Pool claims for the year are presently in line with expectations.
“This can be interpreted overall as encouraging news, but there is a long way to go and the position could of course change significantly before the 20 February year-end. There also seems to be little doubt that the underlying trend in P&I involves increasing claims costs. Moreover, our own experience last year of an unusual number of expensive casualty cases serves to underline the unpredictability of such costs.”
On the investment side, the club’s portfolio produced a return of 1.2 per cent for the year to 31 August. But Gooch cautions, “The recent volatility in the markets is such that we are taking a cautious approach to planning for investment contributions.”
He adds, “Putting all this together and recognising the tough trading conditions faced by members in most shipping sectors, the committee authorised a general increase in rates of 5 per cent for P&I and FD&D” The club’s owned mutual tonnage has increased by more than 1.5m gt during the year so far. The charterers’ portfolio has also continued to grow, so that the club’s total entry stands at 44.3m gt.