Britannia waives a further $11.5m of deferred calls

Britannia P&I has waived a further $11.5m of deferred calls, and will require no general increase in advance calls for 2017/18.

Association chairman Nigel Palmer said yesterday that “Britannia is continuing to support its Members with further waivers of deferred calls while also deciding not to increase its general rates for either P&I or FD&D in 2017/18. The Association’s strong finances allow it to take these positive steps, which assist Members in the most mutual way during the continuing difficult shipping market.”

However, deductibles will be increased.

In P&I Class 3 both the 2014/15 and 2015/16 policy years had developed within projections, and 2016/17 was also developing favourably in early estimates, with benign claims levels both within the Association’s retention and on the Pool.

After a disappointing investment result in 2015/16, investment returns in the current year to date have strengthened, boosted in particular by equities, and are well above the longer-term rate assumed for the policy year.

The Association’s projected capital position for February 20th 2017 remains comfortably over its economic capital benchmark. That financial strength enabled the Committee to agree an ‘as expiring’ rate for P&I advance calls in 2017/18. The budgeted deferred call remains at 45%.

Britannia noted that deductibles had been unchanged for several years. This year they have been increased significantly.

For 2017/18 all deductibles at or below $25,000 will increase by 10%, with the minimum deductibles to increase as follows:

Cargo claims — $12,500 minimum (currently $10,000)

Crew claims — $3,000 minimum (currently $2,000)

All other claims — $7,000 minimum (currently $5,000)

Meanwhile, the 2013/14 policy year will be closed with no further calls.

A further 2.5% will be waived from the 2014/15 deferred call (reducing it to 35%, down from the original 45%) with the 17.5% balance of that deferred call being collected immediately.

The budgeted deferred call for 2015/16, originally set at 45%, will be reduced to 40%. The 25% due to have been collected in October 2016 will be reduced to 20%, “giving Members an immediate cash benefit”.

The Committee recommended that Members continue to budget for a 45% deferred call in the 2016/17 policy year.

In FD&D – Class 6 Britannia reported continued improvement. As a result, for the sixth year out of seven there will be no general increase in the 2017/18 FD&D advance call, with the deferred call remaining at 30%.

In addition, the 2012/13 policy year will be closed with no further call; and the 30% budgeted deferred call for the 2015/16 policy year be collected immediately.

The Committee recommended that Members continue to budget for the deferred call of 30% for the 2016/17 policy year.