Insurer West of England is targeting a 15% increase in premium from its shipowner members at next year's February's policy renewal.

The general increase comes on top of a 7.5% general increase applied by the mutual at the last renewal.

The general increase will apply to shipowners' protection and indemnity cover, as well as its freight demurrage and defence (FD&D) services.

West of England said deductibles, the initial part of the claim paid by members, would also be raised.

The London-based club also said it will not offer renewal terms to tonnage which had repeatedly underperformed to "de-risk" its business.

The mutual said that premiums have been insufficient to cover the cost of claims over recent years.

The club has also been hit by an exceptionally high level of International Group of P&I Club claims last year.

West of England said that the trend of costly International Group claims is continuing. The insurer said claims filed to the International Group in the first six months of this year already exceed last year's historic high.

The mutual said it also continues to be hit by pandemic related claims.

Strong action

"Premium increases are never welcome but the continuing impact of a number of external factors on clubs means corrective steps are unfortunately required," said chief executive Tom Bowsher.

He said "strong action" is needed to defend the club's finances.

"West is taking decisive action now to address the situation and our members can be confident that we will continue to do whatever is necessary to safeguard the club’s financial strength," he added.

West of England is the first of the International Group's 13 members to announce its general increase policy ahead of next year's renewal.

Last year's general increases from P&I clubs ranged between 7% and 10%.

West of England's announcement suggests that all the P&I clubs will be lining up significantly higher increases for their members next year.

The determination of the P&I clubs to correct their underwriting deficit was highlighted earlier by the London P&I Club's announcement of a supplementary call on its members.

London P&I is asking members for additional premium, amounting to between 30% and 35% of annual premium, for the last three years.