Reporting results for its 2019/2020 financial year, The London P&I Club has recorded an operating surplus of US$5.0 million and an increase in free reserves to US$173.9 million.
Earned premium income (net of reinsurance costs) increased by US$13.7 million when compared with the previous year and the result included positive contributions from the Club’s fixed premium products and FD&D Class. In addition, there was an overall 9.1% return from the Clubs’ investment portfolio.
Commenting on the results, Ian Gooch, CEO of the club’s managers (A Bilbrough & Co Ltd), said: “The increase in our free reserve follows a challenging claims outturn for 2019/20. Personnel and cargo claims involving Members ran at unusually expensive levels and there was an increase in the cost of contributions we’ve made to the International Group Pool to help cover other Club’s claims. This, coupled with the effect of reductions in P&I rates over recent years, has impacted on our technical performance leading to a combined ratio of 137%. That’s something which we’re taking steps to address and was a driver of our approach to the 2020 renewal which saw an important increase in rates.”