Standard P&I Club has said that projections for the club’s financial results remained good and that an increase in the reserves of the club was expected at the end of the financial year in February 2018. The board reviewed the club’s financial position and requirements for the 2018 renewal at its meeting in Hong Kong on October 20th. It said that both the underwriting result and investment return on the club’s investments were expected to exceed initial expectations. The board as a result has decided to make a return of mutual call in respect of the 2017/18 policy year in the same manner as the return made for the previous policy year.
A return of call addresses the expectation of a surplus at the end of the current financial year and the Club emphasized that such a return should not necessarily be expected every year.
The Club said that In the P&I class all open years were performing satisfactorily. No calls in addition to the Estimated Total Premium (ETP) were expected and the board will return to members 5% of mutual call for the 2017/18 policy year. Credit notes for this return will be issued in late February 2018 to allow members to offset the return against premiums payable during the course of the 2018 policy year.
Release call percentages were reviewed at the May board meeting and are now nil for the policy years 2015/16 and 2016/17 and 6% for the current policy year. The 2015/16 policy year is expected to be closed in May 2018. Standard Club said that the above release call percentages remained “amongst the lowest in the International Group, reflecting the club’s strong financial profile”.
In the Defence class the class was performing satisfactorily. No call in addition to the ETP was expected. The board determined that the release call margins should remain at the same level as the P&I class.
For the renewal on February 20th nwxt year in the P&I and Defence classes the board determined that no general increase should be applied this year to either. The board asked the managers to increase deductibles for the P&I class by 10%, with deductibles below $20,000 increased by $2,000. The release call for the 2018/19 policy year for both classes will be unchanged at 6%.
Any adjustment in the International Group’s reinsurance costs will be reflected in members’ premium.
ETP will be debited in the same manner as this year, with mutual P&I class ETP being payable 60% within the 2018/19 policy year and 40% deferred to November 2019. For Defence, 100% of the mutual ETP will be payable within the 2018/19 policy year.