REINSURANCE POOLING AND REINSURANCE ARRANGEMENTS FOR 2010 POLICY YEAR
For the 2010 policy year the individual club retention increased from $7 million to $8 million. The Group Pooling arrangements and structure of the Pool remained otherwise unaltered from the 2009 policy year. The UK Club’s record on the Pool continued to be very satisfactory with a loss record of 92 per cent amounting to a credit balance of $65 million.
There was no change to the structure of the International Group reinsurance contract. Although there was a small
premium increase in the first layer of the contract of 5 per cent, the remaining layers of the contract, including the collective overspill layer, were renewed as before. The collective overspill layer was renewed on the basis of a 24 month policy through to 20th February 2012. Despite the increase of 5 per cent it was still possible for reductions to be given for tankers and passenger ships in the reinsurance rates and for a modest increase in the rate for dry cargo ships.
REINSURANCE ARRANGEMENTS FOR 2011
The main feature of the 2011 renewal was a decision by the Group to increase the Pool retention from $50 million to $60 million (see Table 7). This resulted in a reduction in premium to the first layer. The resultant additional $10 million retained risk within the Group Pool was reinsured by the Group captive, Hydra. Hydra in turn took the benefit of the saving in premium on the first layer. Although the contract was effectively renewed on an “as expiring” basis it proved possible to reduce the rate per ton on all categories of tonnage as a result of the increased tonnage in the world fleet.
Table 7: International Group reinsurance arrangements 2011 $ 3,060m
Layer 4 $ 1,000m $ 2,060m
Third General Excess
Layer 3 $ 1,000m $ 1,060m
Layer 2 $ 500m
$ 560m
Layer 1 $ 500m
$ 8m $ 30m $ 60m
$ 30m $ 22m $ 8m
First General Excess
Unlimited Reinstatements
First General Excess
Unlimited Reinstatements
Reinsured by Hydra $ 30m XS $ 30m Individual Club Retention
Second General Excess
Unlimited Reinstatements
Second General Excess
Unlimited Reinstatements Unlimited Reinstatements Oil Pollution
Collective Overspill Protection
One Reinstatement
19
Coinsurance 25% Reinsured by Hydra
Reinsured by Hydra Coinsurance 25%
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