Ahead of the 2023-24 renewal next February, group club Britannia has said that it would “maintain its approach of adjusting individual Members’ rates based on their individual claims record and risk profile, rather than announcing a general rate increase”. Britannia will look to achieve an overall increase of 10% in the ETC for the /24 policy year before any Group Excess of Loss (GXL) rate adjustment.
The Club hoped that “this robust approach to the renewal will reassure Members of Britannia’s commitment to protecting its financial strength through the current challenging environment, while continuing to provide the highest levels of service”.
Britannia observed that 2022 had seen a war in Ukraine, pressure on energy supplies, global inflation rates higher than in the past 40 years and rising central bank interest rates. Together, these had resulted in significant declines across all investment classes. Inflation, both economic and social, was expected to impact future claims exposure.
The Club said that rising claims and a volatile investments market meant that rebalance would best be achieved through increasing premium.
Retention claims in the current year were running marginally ahead of projections and included Covid-related claims. Pool claims in the current policy year had been benign with none reported to date. However, Pool claims in prior policy years had continued to deteriorate.
Britannia said that it remained financially strong but that further rate increases were required for the 202-24 renewal in order to address robustly the underwriting deficit.
For policy year 2023-24 members’ individual rates will be adjusted to reflect their claims record and risk profile, as well as any changes in
the cost of the International Group Reinsurance Programme. Britannia will undertake a technical based renewal
of its membership to promote sustainable premiums and restore underwriting balance. Whilst there is no declared
general increase with Members continuing to be underwritten individually, the Board has targeted a 10% increase
on Britannia’s ETC.
All minimum deductibles in P&I Class 3 will be increased to the following levels.
or the USD equivalent at 25 October 2022 if premium is levied in another currency. Members will have the option to vary their deductibles in return for an appropriate rate adjustment.
The Board set the following release calls percentages:
These percentages will be reviewed further in 12 months’ time.
Class 6 – Freight, Demurrage and Defence
At renewal /19 the initial cost absorbed by Britannia of $5,000 per claim was increased to $7,500. At renewal /20 Members’ one-third contribution to all costs in excess of $7,500 was limited to a maximum of $150,000 per claim.
Britannia noted that the /23 rate increase was only the second increase since /14. It said that an additional adjustment to premium rate for /24 would be required to address the continuing underwriting deficit.
Members’ rates will be adjusted to reflect their individual claims records and risk profiles to achieve a 15% increase on Britannia’s ETC but there will be no declared general increase.
Release calls
The Board set the following release call percentages:
These percentages will be reviewed further in 12 months’ time.
