February 21, 2007
American Club reports "robust" renewal
The American P&I Club has outperformed market expectations at the renewal of its membership portfolio which was finalized today.
The club says "2006 was not an easy year," with additional supplementary calls being required for two open years (2005 and 2006) in order to build surplus.
However, says the New York-based mutual, the overall loss of tonnage and premium has been relatively modest.
Preliminary figures indicate a respectable uplift in the average premium rate per ton on renewing business. This, coupled with increases in deductible levels, "augurs well for a decent underwriting result in 2007."
Speaking in New York today, Joe Hughes, chief executive of the club's managers, Shipowners Claims Bureau Inc., said: "We knew from the outset that the 2007 renewal was not going to be easy-- nor was it. But we also knew what we had to do and approached the task with realism and resolve."
The outcome was significantly better than many might have predicted, despite an overall loss of tonnage and premium which was at a lower level than some observers forecast."
Mr Hughes continued: "Although these are preliminary figures, in addition to the tonnage the club decided not to renew Ð about 500,000 gt in total--there was a further loss of some 900,000 gt of business which went elsewhere. However, this was offset by about 1.3 million gt of new entries to the club.
"In premium terms, there was a net loss of non-renewing business of about $5 million, equivalent to about 4% of total expiring gross premium."
"All in all, we are reasonably content with the overall outcome," said Mr Hughes. "Tighter underwriting, enhanced quality control, loss prevention and other measures which have recently been implemented by the club are showing positive results and point to further strong progress over the year ahead."