Results for Shipowners’ Club show growth, suggest long-term stability

The Shipowners’ Club saw a 5.8% increase in gross premiums for the year ended Feb. 20, 2013, achieved through organic growth despite continuing difficult economic conditions and an increasingly competitive market, the company noted in releasing its Annual Report 2013 late last week.

The increase in gross premiums amounted to US$221.9 and was achieved without the need for substantial general increases, says a June 14 press release from the specialist protection and indemnities mutual, which serves the smaller and specialist vessel sectors around the world. The increase was compared to gross premiums of US$209.7 million for the previous year.

The mutual saw the number of vessels entered increase by approximately 4.6% to almost 33,000, with their total tonnage rising by 10.8% to 21.9 million gross tonnage. Overall, claims frequency and the average cost of claims per ton increased, particularly with higher value claims, Shipowners’ Club reports.

Other financial highlights at February 20, 2013 versus 2012 include the following: the overall surplus was US$40.9 million compared to US$46.5 million; claims incurred, net of reinsurance, was US$146.8 million compared to US$118.2 million; and investment return net of tax was US$31.9 million gain compared to US$18.0 million gain.

The overall underwriting surplus reached US$8.9 million, representing a combined ratio of 95.5%, compared to 85.0% in 2012. “Over the past five years, prudent underwriting and management practices in a highly volatile and competitive marketplace have resulted in an average combined ratio of 88.9%,” chairman Donald MacLeod notes in his review of the annual results.