The long voyage of the Liverpool & London Steamship Protection & Indemnity Association is set to come to an end at the New Year, as outstanding liabilities are transferred to a Maltese insurance company.
London high court judge, Justice Newey, this week sanctioned a Part VII transfer of the P&I club’s business to R&Q Insurance (Malta).
The transfer takes effect from 31 December and paves the way for a payout to the club’s remaining members, who include club chairman, Lou Kollakis, other Greek shipowners, such as Adam Polemis and Victor Restis, as well as companies that include United Arab Shipping Co (UASC).
The Liverpool & London Club was set up in 1881 but went into run off at the February 2000 renewal after a series of cash calls. Most members transferred to the North of England Club.
But residual liabilities, notably relating to crew asbestos claims, as well as other industrial disease cases involving stevedores and dock workers, meant the club had to continue in business.
TradeWinds reported in September that the Liverpool & London Club had a balance sheet of £24.4m ($37.5m), with £16.6m ($25.5m) to be paid to R&Q for taking on the outstanding liabilities.
This leaves £7.7m ($11.8m) potentially available to return to shipowner members, who received an earlier $25m distribution in 2007.
There are still 539 open industrial-disease claims, almost all of which relate to asbestosis but a few to hearing damage, which may take another 20 years to settle.
Court approval of the Part VII transfer was required to ensure claimants and others in a business relationship with the club were not disadvantaged by the deal.
Part VII transfers, under the UK’s Financial Services and Markets Act of 2000, bring finality to a run-off - in contrast to a reinsurance to close, which could potentially leave member shipowners with outstanding liabilities.
R&Q Insurance (Malta) is part of Randall & Quilter Investment Holdings, founded by Ken Randall and Alan Quilter in 1991, and listed on the London Stock Exchange’s secondary AIM market
“We are delighted to have completed the transfer of this book of business, especially as it is the first time a P&I Club has transferred business to an insurance company in such a manner. This transaction adds to the scale of R&Q Insurance (Malta), being the largest external Part VII the Group has undertaken to date and we are pleased to be able to provide longevity of service and security to the Club’s policyholders, members and claimants,” said R&Q chairman and chief executive, Ken Randall.
The Liverpool & London Club was chaired for many years by White Star Line’s Bruce Ismay, and famously covered the Titanic. But had shrunk to insuring a 7m gt fleet by the time it went into run-off.
