Claims values & composition
- Total cost of claims in the first six months of 2013 is greater than previous years at the same stage of development.
- Large casualties biggest factor in the overall growth in claims.
- In 2013, large claims (over $0.5m) contribute two thirds of the total claims cost.
- Pool costs have fallen following the reduction in the Club’s share.
- Crew illness claims have demonstrated a long-term inflationary increase of approximately 12% per annum.
Claims frequency & value
- Claims frequency dropped sharply in 2009
- The average cost per attritional claim has increased by 30% since 2006
- The total cost of attritional claims is similar to 2006 despite the lower frequency
- This graph shows average cost of an attritional claim. Figure 4, (page 5) shows total notified attritional claims
- Higher claims experience in 2013 has led to the first fall in capital since 2008
- The Club continues to hold sufficient capital to meet regulatory requirements and rating agency targets
- Combined ratio of 113% at the half year is outside the Club’s acceptable range
- Claims inflation as well as large claims have led to the increase
- Prudent investment portfolio with 76% of assets held in cash or fixed income securities
- Equity element of the portfolio has performed well over the first six months of the year.