Steamship Mutual is to apply a 12.5% general increase in premium at the February 2022 policy renewal to address its underwriting deficit.
The London-based protection and indemnity insurer said that in the current policy year the club had experienced an increase in its own claims — and claims which are shared with other clubs — through the International Group of P&I Clubs pool.
The increase is in line with planned increases from other P&I clubs including Britannia P&I and the UK P&I Club.
S&P Global Ratings has also downgraded Steamship Mutual's outlook from A stable to A negative.
The downgrade was attributed to "exceptional and adverse" International Group pool claims.
Steamship Mutual chief executive Stephen Martin said that an increase in premium is necessary to address the club's underwriting deficit, and to protect its financial strength.
"The dominant feature of the projected outcome for this year is a very marked increase in the cost of pool claims, which are shared by all the International Group clubs and thus a common experience for each of them," Martin said.
In the last policy year Steamship Mutual ran at a combined ratio of 125%, reflecting a significant loss in its underwriting activities.
"Naturally the directors prefer not to ask for premium increases, but we believe that these steps will protect the club's financial strength now and in the future," Martin added.
In a more positive development Steamship Mutual's owned entry increased by 6.7% in the period 20 February to 20 October 2021. The combined owned and chartered entry now stands at over 178m tons.
