February 23, 2010 by Canadian Underwriter
Ship owners experienced a more benign protection and indemnity (P&I) renewal at Feb 20, 2010, according to Aon Risk Services.
General increases ranged between 0% and 12.5%, with a market average of 4.54%, the marine division of Aon reported.
Owners faced general increases between 10% and 29% in 2009.
“Aon predicts that if the clubs achieve their targets, approximately $159 million of additional premium will enter the P&I system at this year’s renewal,” said Steve Griffiths, director of Aon’s marine P&I team.
This is down significantly from last year when the market was inflated by an additional $485 million during the 2009 renewal period, he added.
Lower general increases were offset by closer scrutiny of individual club members’ loss records, he noted.
“The shipping market has put many ship owners under severe pressure to reduce expenses, which meant protracted negotiations in some cases,” Griffiths said. “Despite the unpleasantness that can arise when there is little room for maneuver, we do not anticipate many major switches in tonnage among the clubs at this renewal.”