Steamship Mutual, a major Protection & Indemnity (P&I) Club, has released its 2009 Management Highlights. “The visual theme of the Highlights this year is the illustration of Steamship Mutual’s qualities and aims through the beauty and diversity of marine life,” said the bulletin.
The Highlights provide an insight into the challenges created by the banking crisis and the world recession for the shipping and P&I industries over the last year and the steps that Steamship Mutual has taken to address their impact, as the Club enters its centenary year.
The diverse topics covered include the “Club’s role in helping Members mitigate the risks of piracy, the need for sustainable underwriting, an analysis of the claims environment over the year, highlighting the reduction in the incidence of large claims, and the vital role played by the Club’s loss prevention initiatives in helping its Members control their claims exposures.
“The Highlights also provide in depth analysis of the combined financial position of the two Steamship Mutual Clubs and the Steamship Mutual Trust, showing how Steamship Mutual overcame its substantial investment losses, through a combination of strong underwriting results and raising additional capital, to achieve a modest operating surplus, and discuss the decision to reduce risk in the combined investment portfolio.”
Summary of Financial Results:
— Operating surplus of US$2 million.
— Free reserves rise to US$187.7 million.
— The overall combined ratio falls to 90.3 percent, excluding additional premium, compared to 97.9 percent in the previous year.
— Combined ratio target lowered to 100 percent from108 percent.
— Total entered tonnage rises by 3 million GT to 75 million GT.
— Net incurred claims for 2008/09 reduce by US$21 million compared to 2007/08 at the 12 month stage.
— Overall combined increase of 13.5 percent in premium achieved from renewing Members
James Stockdale, CEO of the Club’s Managers, commented: “”This year Steamship Mutual celebrates its centenary – “A century of service to shipping.’ To mark its first 100 years, the Directors will be hosting a number of events in the Club’s major markets and have commissioned a history to illustrate Steamship Mutual’s journey from a small regional English P&I club to one of the leading and most geographically diverse clubs in the International Group. The fact that the Club has just come through one of the most financially challenging years in its history able to report robust underwriting results, an operating surplus and an increase in free reserves is a tribute to the loyalty and support of Steamship Mutual’s long-term Members and the resilience of the mutual P&I system.”
“During the 2008 financial year we have seen a further improvement in claims levels from the exceptional heights of 2006. It would be unwise to assume that this ‘trend’ will continue in 2009/10 just because we are experiencing an overall decline in shipping activity. It will take time for lower activity levels to show through in the claims figures and may well only have a marginal effect on the current year.”
“The Directors and Managers are very appreciative of the highly supportive response from the Club’s Members at the renewal which has enabled us to report a 13.5 percent increase in renewed premium, further reinforcing the Club’s strong underwriting position, as well as a modest net increase in tonnage. We will do our utmost to earn our Members’ support through top quality service, prudent underwriting and good financial security.”
Source: Steamship Mutual – www.simsl.com
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