The United Kingdom Mutual Steam Ship Assurance Association has kicked off the annual protection and indemnity renewal round by declaring a 3% general increase.
The rate rise is down on the 5% figure of the last two years reflecting low claims experienced by the UK Club and an $8m surplus through the first half of the current P&I year.
The free reserve of the 'A-' rated UK Club rises to $486m as of 20 August.
“We were determined to strike a balance between ensuring our premium does not fall behind claims inflation while at the same time doing all we could to limit the impact of the increase on our shipowner members,” said UK Club chairman Dino Caroussis of Chios Navigation.
“Although we have been fortunate to enjoy lower claims numbers, there is still an average inflation on P&I claims of around 5 per cent. This underlying inflation will quickly manifest itself in our claims costs once the frequency picks up again, as it surely will one day. Taking all of this into account we set the general increase for 2012 at 3%,” Caroussis told a post annual general meeting gathering of members in Athens.
Caroussis attributed the improved financial position and rebuilding of the free to reserve to reduced claims and careful risk management.
“The club’s capital adequacy as measured by S&P’s capital model is now in the AAA range and we have free reserves of $4.50 per ton,” he added.
