At Swedish Club’s reception on the opening day of London International Shipping Week, managing director Lars Rhodin observed that the combined ratio for the first half was 108%, which he said was “a little bit unsatisfactory”, but was “very much driven by Pool claims”. He warned that this could be the second-worst year for many years, and that the market premium was insufficient to cover that level of loss.”
Tord Nilsson, director of underwriting, reinsurance & risk control, said that the hull and machinery market had been “soft for a very long time”.
However, Nilsson said that the market had turned “a bit firmer”. However, Swedish Club did not think that it was yet “a hard market”. While there had been some fairly good increases, “we believe that it is still underpriced by 15% to 25%”. He said that it might be a good sign for insurers, but perhaps not such a good sign for shipowners, “but they have been enjoying a very good market for a very long time”.
As for the P&I market, there had been premium declines for some time. “But it feels like some of the clubs are waking up with a bit of a hangover”, because “although the free reserves are great, the premiums are really not there to support the current level of claims”. He said that the Swedish Club had been quite diligent, “trying to do what we can to protect the bottom line”.