Gard continues to lead IG tonnage, but North moving up the pecking order: Tysers

Broker Tysers has now released its annual assessment of the P&I Market and, in particular, the International Group Clubs. IMN will be summarizing the individual clubs over the coming days, concluding with a combined summary of the club’s financial performances, conditions, rankings, ratings etc.

Having completed summaries of the individual Group Clubs, here are some tables comparing the various Clubs.

P&I MARKET SHARE

These comparisons show the relative size of the P&I Clubs by owned gross tonnage, financial year income and free reserves as at 20th February 2021.

P&I Club Owned GT % Accounting Year Premium $ %
Gard* 261,400,000 19.28 887,651,000 23.31
North 158,000,000 11.65 406,159,000 10.66
UK 137,500,000 10.14 286,376,000 7.52
Britannia 125,200,000 9.23 200,086,000 5.25
Standard 121,000,000 8.92 292,700,000 7.69
West 106,400,000 7.85 243,037,000 6.38
Skuld** 98,000,000 7.23 390,839,000 10.26
Japan 97,000,000 7.15 178,080,000 4.68
Steamship 96,000,000 7.08 284,405,000 7.47
Swedish*** 56,000,000 4.13 173,838,000 4.56
London 52,900,000 3.90 119,497,000 3.14
Shipowners 27,830,000 2.05 232,081,000 6.09
American 18,700,000 1.38 113,934,000 2.99
TOTAL 1,355,930,000 100 3,808,683,000 100

*Premium for all lines of business. P&I income $520m

By comparison, market share in 2016 was as follows:

P&I Club Owned GT % Accounting Year Premium $ %
Gard* 215,200,000 18.65 873,941,000 21.12
UK 135,000,000 11.70 385,360,000 9.31
North 131,000,000 11.35 489,810,000 11.84
Standard 116,000,000 10.05 354,300,000 8.56
Britannia 105,900,000 9.18 260,722,000 6.30
Japan 92,200,000 7.99 224,258,000 5.42
Skuld 82,200,000 7.12 409,980,000 9.91
Steamship 77,800,000 6.74 350,329,000 8.47
West 72,100,000 6.25 227,614,000 5.50
London 44,400,000 3.85 110,072,000 2.66
Swedish 43,650,000 3.78 109,958,000 2.66
Shipowners 24,630,000 2.13 243,293,000 5.88
American 14,100,000 1.22 97,504,000 2.36
TOTAL 1,154,180,000 100 4,137,141,000 100

*Premium for all lines of business. P&I income $607m

There are no positive rating outlooks for any of the clubs, and not a few negative ones. While many clubs have enough capital backing to make them “triple A”, all Group clubs are marked down by S&P because of their lack of diversity in terms of risks insured.

Standard & Poor’s Ratings Of P&I Clubs

  2017 2018 2019 2020 2021 Outlook Aug 2021
Gard A+ A+ A+ A+ A+ Negative
Britannia A A A A A Stable
Skuld A A A A A Stable
Steamship A A A A A Stable
Shipowners A A A A A Stable
UK A A A A A Negative
North A A A A A Negative
Standard A A A A A Negative
Swedish BBB+ BBB+ A A A Stable
West A A A A A Negative
Japan BBB+ BBB+ BBB+ BBB+ BBB+ Stable
London BBB BBB BBB BBB BBB Negative
American BBB BBB BBB BBB BBB Stable

Average Expense Ratios (AER)

The AER was introduced in 1998 as a means of comparing the administration costs of the mutual P&I Associations under the terms of their exemption from the EU Competition Directive. The Clubs are only obliged to report their five-year AER and the below figures are all five year averages.

  2017 2018 2019 2020 2021
American 25.70% 27.90% 26.60% 24.30% 22.20%
Shipowners 22.00% 22.00% 24% 23% 22%
West 15.15% 14.75% 14.68% 14.60% 14.60%
North 12.00% 12.10% 12.70% 13.70% 13.60%
Gard 12.02% 11.21% 13.04% 12.81% 13.51%
Swedish 13.30% 13.40% 13.80% 13.20% 12.80%
Standard 12.40% 12.50% 12.78% 12.90% 12.70%
Skuld 12.80% 12.70% 12.80% 13% 12.60%
Steamship 12.10% 12.20% 12.40% 12.10% 11.90%
Britannia 9.42% 9.73% 10.90% 11.50% 11.66%
UK 10.22% 10.31% 11.09% 11.28% 11.45%
London 9.51% 9.68% 10.30% 10.41% 10.46%
Japan 5.46% 6.21% 6.52% 7.42% 8.02%
Average 13.24% 13.44% 13.97% 13.86% 13.65%

2021 Limits and Deductibles

Club Standard Limit Standard Deductible
API $2m (up to $10m on request). 25% Minimum $5k maximum $30k.
Britannia $10m (but $2m sale and purchase). 1/3 of all expenses in excess of $7,500 (capped at $150k).
Gard $10m (but $1m for pre delivery). Deductible 25%, minimum $5k.
Japan Yen 1.5 billion (Eq $13.7m). One third of all costs in excess of $1k.
London $7,500k. 25% of all costs.
North None (but $250k for building, purchase, sale and repair etc). 25% with a minimum of $10k and a maximum of $150k per claim.
SOP $5m ($1m building, purchase/ sale). 25%, minimum $5k maximum $30k.
Skuld $50m ($300k for purchase etc). 25% (min. $12,500).
Standard $5m. 25% (min. $10k).
SSM $10m ($2m construction, purchase etc). $7,500 then one third overall maximum $50k.
Swedish $5m (up to $10m on request). $12k. However, for costs incurred in excess of $250k a further deductible of 25% applies.
UK $15m. Nil but no cover for dispute less than $10k.
West $10m inc new build disputes; $15m can be arranged if required. $5k and 25% of the claim in excess of the amount of $5k, provided that the total deductible shall not exceed $50k except where the claim relates to a contract for the building of an insured vessel where the total deductible shall not exceed $100k.