Owned tonnage has continued to grow at Steamship Mutual, the P&I Club reported at a Board Meeting in Miami, USA on October 24th. It rose by 3.8m tons in the period February 20th 2017 to October 20th, increasing the combined owned and chartered entry to 154m tons.
For the 2017/18 policy year the club said that the overall cost of claims for the current year was higher than “the very low level” at the same point last year, noting that it still compared favourably with the average experience of the past three years. The number of claims estimated in excess of $250,000 remained lower than in recent years, but the average cost of those claims for the policy year to date was notably higher.
There had been 10 pool claims reported, of which four were provisional, for the current policy year. Steamship said that pool claims estimates were still immature at this stage and their future development remained uncertain.
Years up to and including 2014/15 had developed in line with expectations but 2015/16 and 2016/17 had shown deterioration in some claim categories. The overall result was that the release from prior years was below expectations.
On the investment side, in the eight months to end-October the club recorded a return of 2.3% excluding currency movements (which are allocated to the underwriting result). Within the club’s surplus portfolio, returns from equities were particularly strong.
The Steamship board has decided to return to members 10% of premium paid on Class 1 P&I mutual entries in the 2015/16 policy year, equivalent to approximately $26m. Any credits due will appear on member’s statements on November 20th.
For 2018/19 premium ratings, the directors said that they had considered claims trends and noted an elevated level of premium churn over the past two years. Despite this, and in view of the continued financial strength of the Club, the board decided that, for a fourth successive year, no standard increase would be applied on any class of business for the 2018/19 policy year, although as usual the Managers would correct individual Member premium ratings where necessary and to pass on to Members any adjustments in the costs of the International Group reinsurance programme, whether up or down.
The Directors made no changes to release calls so that Class 1 P&I and Class 2 FD&D entries will continue to be subject to release calls as follows:
The release call for the 2018/19 policy year will also be set at 12.5%.