Swedish Club sees H1 premiums down year on year, combined ratio at 96%

Swedish Club has reported gross premiums earned of $72.5m for the first half to June 30th 2018, down from $79.6m in H1 2017. Premiums net of reinsurance declined to $55.6m, from $61.2m in the same period last year.

The underwriting result fell to $4.7m from $6.0m, while the financial result fell to a loss of $4.5m, from a gain of $16.3m in H1 2017. That left a result before appropriations, tax & discount of +$0.2m, down from a gain of $22.3m in H1 2018. The combined ratio for the half was 96%, compared with 94% in the same period last year.

The Club noted that financial markets displayed increased volatility in H1, with major stock markets and world indices down at mid-year, while USD interest rates continued to climb. “As a result, the investment portfolio showed a return of minus 0.4 %, in line with the Club’s benchmark”, the club said.

Following a 5% discount, up from 4% last year and effective August 20th 2018, the Swedish Club saw free reserves decline to $209.6m, from $213.8m at this point last year.

Total equity, provisions & liabilities fell to $545.4m, from $592.4m.

The Club said that the reduction in the balance sheet came “predominantly from payments of previous years’ claims and a generally lower claims activity”.

Eligible own funds were $284m, compared with a Solvency II capital requirement of $104m.

The Club noted that it had delivered an average combined ratio of below 100% for 10 years, “despite a continued soft market for marine pricing and the third consecutive year of a zero general P&I price increase”.

Swedish Club currently insures some 2,700 ships on hull & machinery and has doubled its volume in P&I over the last decade to in excess of 50m gt. When charterers’ liability is included the total is above 80m gt.

Lars Rhodin, Managing Director of The Swedish Club said that “looking ahead we will continue to work according to our strategy, which is to provide top quality and efficient all-in-one insurance solutions for global shipowners.”