There is now strong evidence of a link between the performance of the shipping markets and the volume of P&I claims, particularly the attritional or lower level claims. Although there are some tentative signs of recovery in parts of the world economy, many sectors of the shipping market remain in the doldrums and this is likely to continue for at least the next 12 months. The outlook for attritional claims is therefore likely to be benign in the near future. The larger claims, those in excess of $500,000, are more random in nature and do not necessarily follow the same pattern.


The table below shows the best estimate of the ultimate claims by policy year along with the cost of the Pool as a proportion of the total claims. The main change during the financial year to 20th February 2011 has been the positive


Table 4: Ultimate claims (best estimate) for policy years 2001–2010 at February 2011


150 200 250 300 350


100 50 0 2001 2002 2003 2004 Non Pool 10 2005 Pool 2006 2007 2008 2009 2010 % of Pool total


5% 10% 15% 20% 25% 30% 35%


0


development in the claims on the 2008 and 2009 policy years and the consequent reduction in the ultimate claims provision on those years. The 2010 policy year is at a very early stage of development and even though the year is showing a similar development to that of 2009 policy year the claims ultimate is higher reflecting the inherent uncertainty in forecasting claims after only 12 months development. It is expected that 2010 is likely to deliver a similarly encouraging underwriting result as 2009 once the year has developed for a further 12 months.


Ultimate claims ($m)


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