2011 ROTY - UK P&I
2011 ROTY - UK P&I
2011 ROTY - UK P&I
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There is now strong evidence of a link<br />
between the performance of the shipping<br />
markets and the volume of P&I claims,<br />
particularly the attritional or lower<br />
level claims. Although there are some<br />
tentative signs of recovery in parts of<br />
the world economy, many sectors of the<br />
shipping market remain in the doldrums<br />
and this is likely to continue for at least<br />
the next 12 months. The outlook for<br />
attritional claims is therefore likely to<br />
be benign in the near future. The larger<br />
claims, those in excess of $500,000,<br />
are more random in nature and do not<br />
necessarily follow the same pattern.<br />
The table below shows the best estimate<br />
of the ultimate claims by policy year<br />
along with the cost of the Pool as a<br />
proportion of the total claims. The main<br />
change during the financial year to 20th<br />
February <strong>2011</strong> has been the positive<br />
development in the claims on the 2008<br />
and 2009 policy years and the consequent<br />
reduction in the ultimate claims provision<br />
on those years. The 2010 policy year<br />
is at a very early stage of development<br />
and even though the year is showing<br />
a similar development to that of 2009<br />
policy year the claims ultimate is higher<br />
reflecting the inherent uncertainty in<br />
forecasting claims after only 12 months<br />
development. It is expected that 2010 is<br />
likely to deliver a similarly encouraging<br />
underwriting result as 2009 once the year<br />
has developed for a further 12 months.<br />
Table 4: Ultimate claims (best estimate) for policy years 2001–2010 at February <strong>2011</strong><br />
350<br />
35%<br />
300<br />
30%<br />
Ultimate claims ($m)<br />
250<br />
200<br />
150<br />
100<br />
25%<br />
20%<br />
15%<br />
10%<br />
50<br />
5%<br />
0<br />
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010<br />
0<br />
Non Pool<br />
Pool<br />
% of Pool total<br />
10