JULY 30, 2012 — Eagle Ocean Marine (EOM), a specialist fixed-premium P&I and FD&D (Freight, Demurrage and Defense) facility underwritten by the American Club, reports an excellent first year of operation, and a strong start to its second year following the favorable renewal of its quota-share reinsurances in the London market earlier this month.
EOM provides P&I and FD&D cover for operators of smaller ships up to 12,500 gt in local and regional trades. With P&I cover of up to $50 million per risk, it is aimed at owners who do not require the high limits of cover provided by the mutual clubs, and who prefer a fixed-premium approach to their insurance needs.
EOM's first-year premium exceeded $5 million, slightly outpacing original projections. Increasing market interest in the facility, indicated by rapidly rising levels of enquiries and orders, suggests a promising outlook for the second and subsequent years.
EOM performed well during its first year. The incidence and severity of claims were at encouragingly low levels, reflecting a prudent policy of risk selection and pricing. Results to date show a healthy credit balance of premium over claims.
The facility's tonnage by vessel type is broadly based, with tankers, general cargo vessels, bulkers and tug and barge business forming the main sectors in approximately equal shares. EOM insures ships worldwide with the exception of the U.S. About 55 percent of its current business is from Asia, the remainder coming mostly from Europe, Latin America and Africa.
Speaking in New York, Joe Hughes, Chairman and CEO of Eagle Ocean Agencies Inc., gave an upbeat assessment. "The results to date are very encouraging," he said, "and augur well for the future. We are determined to make EOM a growing success for all its stakeholders – i.e., its clients, the club, its reinsurers and its many other business associates."
Mr. Hughes added: "We take the long view when it comes to developing market share, and will continue to ensure that the EOM product is characterized by careful risk selection, sensible pricing, effective loss prevention and unmatched claims processing serviced by AC/EOM offices in New York, London, Piraeus and Shanghai.
"Inspired by the traditions of classic P&I mutuality, EOM seeks to occupy a special place in the fixed-premium sector for those who desire a high-quality approach to their insurance needs. We are confident that EOM's business model will enjoy increasing success over the years ahead."