The Club welcomes operators from all regions and sectors of shipping, with operational quality and safety performance being the dominant underwriting criteria.
The Club seeks controlled growth whilst maintaining balanced underwriting results; thus, on the basis of claims history, credit reports, port state records, sanctions checks, pre-entry inspections, fleet age criteria, the Club declines to offer quotes for about 25 per cent of applications for Membership each year. As part of monitoring the standard of the existing entered fleet, the ship inspection department arranged visits to 446
ships during the year.
During 2014, the Club experienced high levels of underwriting activity, both in terms of additions and also sales and scrapping by Members. 13 million gt was entered mid-year, more than half of which were new buildings, while Members sold or scrapped 10 million gt in the same period.
A positive effect of this activity has been that the average age of entered tonnage continued to fall during the year. While it resulted in a slight decrease in gross mutual premium, the younger age profile will benefit the Club in future years. For the two largest trade categories by tonnage, tank and bulk, the average age is 9.0 and 7.6 years. Even with an improved age profile, it is in the nature of our industry that large losses will occur from time to time. The Club’s underwriting policies are structured so that the cost of these random large claims are shared across the Membership, in particular through the allocation of projected Pool and abatement layer claims. These policies play an important part in maintaining underwriting balance over the cycle, and they affect the premium needs of all Members. To assist Members understand this approach, the Club published an updated version of the booklet “Understanding Your Loss Record” during 2014.
2015 has also seen the Club extend the range of products offered to Members, in particular for risks related to logistics operations for liner Members and of offshore supply craft operators. The Club looks forward to working with Members and their brokers where these and other additional covers are needed.