Jonathan Andrews took over from Stephen Martin as chief executive of protection and indemnity insurer Steamship Mutual last year, and so far it has been a pretty smooth transition.
The club recorded a 7.5% increase in its entered mutual fleet after the 20 February renewal.
Earlier, management had announced a $25m capital return to the membership. Furthermore, at Steamship’s recent Manila board meeting, Andrews reported the club had achieved an $84m investment income and would likely break even on underwriting for the full year.
“I inherited a club in good health, the membership is growing and the club’s finances are very strong ... a pretty good hand of cards. I’m trying my best not to make a mess of it,” he said.
Andrews has spent his whole career at Steamship and its business ethos is ingrained, which he believes has helped him to take to the leadership role quickly.
The club’s long-standing formula for success has been to focus on its core mutual P&I business, build a strong capital base and maintain a high-quality membership.
The strategy has positioned it as the industry’s fourth-largest P&I club with 125m gt of mutual tonnage on its books, with an “A stable” rating from S&P Global Ratings and free reserves of $454m.
It has preferred to keep money in the club rather than invest it in diversifying its business.
That, along with investment returns, has helped build one of the strongest balance sheets in the International Group of P&I Clubs.
Claims volatility
One benefit of having a strong capital base is that Steamship does not need to use the reinsurance markets to hedge its exposure and it has the strength to ride out the inevitable claims volatility in the P&I market.
That has again enabled it to return cash to members more often than most of its competitors in the good times.
“If it ain’t broke don’t fix it,” is an adage that could be applied to Steamship’s approach and certainly Andrews does not see the need to mark his executive role with a bold new strategy.
“We feel that we have very good support from the board and the members and that we don’t have to do anything different,” he said.
“There’s always the need to see what’s going on around you in any market and we certainly do that. We keep our ear to the ground, we take soundings from members as to what they like and don’t like about ourselves, and indeed our competitors,” Andrews said.
“But for the moment, we’re very content with the position that we’re in.”
Steamship has been looking to grow. Its latest addition is a new office in Japan to build on its more established strongholds in Asia, North America — where it has probably the largest share of cruise operators among P&I clubs — and Greece.
Cyprus is the home of its European office.
While the club sticks closely to its business plan, it would be wrong to characterise Steamship as conservative.
It was the first of the P&I clubs to appoint a woman to head up one of its shipowner boards when it appointed Magsaysay Lines’ Doris Magsaysay Ho to chair its Bermuda board.
Steamship — via syndicate manager of claims Tony Nicholson’s role in the International Group — has recently been supporting a Philippines government project to develop a so-called “Magna Carta” for seafarers.
This is a new piece of domestic legislation that will incorporate the welfare benefits of the Maritime Labour Convention 2006 into national law.
The idea is to help maintain the Philippines’ status as the leading labour supply country, which helps Steamship’s membership, particularly those in the cruise industry.
Mental health
The insurer has also embarked on other initiatives in support crew welfare, including its onboard mental health support services, which it launched during the Covid-19 crisis.
With a large corporate membership, Steamship is also geared towards helping them on the road to decarbonisation.
“We have our own ESG [environmental, social and corporate governance] group here in the club who are advising members on decarbonisation as well on a whole range of ESG-related issues,” Andrews said.
However, there is one change on the cards. Steamship is planning to move from its London office near Liverpool Street in the east of the city.
Andrews has been following the same route to his office since he joined the firm 36 years ago and old habits die hard.
“No doubt the day we move to the new building I’ll still be plodding along here and then realise I’ve taken the wrong turn,” he said.
