P&I Sector’s Underwriting Discipline to Be Tested
Wednesday, 02 10 2016, Category: Insurance and Reinsurance, Country: World
Underwriting discipline in the marine protection and indemnity (P&I) sector will be tested over the February 2016 renewal period due to market and competitive forces buffeting the sector, according to report published by A.M. Best.
Free reserves are at record levels, the ratings agency said, while the clubs’ ship operating owners still face challenging commercial conditions and are looking to reduce costs. At the same time, the report added, insurance market competition is intense, exacerbated by a growing fixed premium market offered by insurance companies – all forces that are putting rates under pressure, A.M. Best added.
The P&I market remains dominated by members of the International Group of P&I Clubs, which as mutual insurers operating for the benefit of their members, have to balance the need to maintain their financial stability with the fiscal constraints of their membership, said the report titled “P&I clubs under pressure while cost of claims continues to increase.”
Source: Insurance Journal