The North of England Protecting and Indemnity Association is to seek no general increase at the February renewal of cover but instead return 5% of premium for the current year.
Eight of the 13 International Group P&I clubs have now decided against a general increase with more expected to follow this trend.
The North of England Club’s return of premium will take the form of a credit note that can be applied against the cost of cover for next year so amounts to a continuity credit that will be set against the first instalment of the 2017 premium.
The renewal strategy reflects lower than average claims but is also a recognition that shipowners are trading in a difficult market.
Club chairman, Pratap Shirke of ASP Ship Management, said the Newcastle based mutual which insures 131m gross tons of owners tonnage was in a healthy financial state.
The ‘A’ rated North of England Club rang up the best financial performance in the P&I market last year with a more than $90m surplus lifting the free reserve to $428m at the start of the current policy year.
“Despite continuing volatility in the bond markets, which has again negatively impacted the club’s pension scheme, our healthy investment returns and a generally favourable claims experience mean the North remains in a strong financial position,” said Shirke.
Shirke also highlighted that the North of England Club had not needed to levy an unforecast cash call for 25 years.
The zero general increase applies to both P&I and defence cover. There was a general increase of 2.5% for P&I risks at the February 2016 renewal and higher figures in earlier years.
P&I cargo deductibles below $25,000 will go up by at least $2,000 and crew and other deductibles will rise by a minimum of $1,000. Deductibles for defence cover will be unchanged.
