The 2017 P&I renewal season has now finished on the traditional renewal date of February 20th. This is the date on which, for more than 100 years, P&I mutual “Clubs” have renewed all their memberships simultaneously. The origins of this simultaneous 20 February P&I renewal relate to the old times when vessels were made of wood and ice season in the Baltics prevented trade until roughly February 20th.
Whether the February 20th date still makes sense in the modern era, or whether is is more of a tool for the members of the cartel the International Group of P&I Clubs to keep pricing up is open to debate. But what is not open to debate is that this year saw owners having some advantage over the underwriters. As the Clubs were not demanding general increases this year negotiations focused on price reductions and reportedly some owners have achieved very good results, with 5% reductions being the starting point of negotiations.
While clearly still a traditional renewal date for commercial vessels, February 20 is not so important for yachts and pleasure craft. Some Clubs, such as Steamship Mutual and Shipowners, do offer a dedicated product for yachts but Club cover for yachts is really only purchased by owners of true super yachts with very high values and who truly require the higher limits of liability that P&I clubs can offer.
Our International Group P&I Club Article contains more information about the International Group of P&I Clubs.© Sunrise Marine Risks and sunrisemarinerisks.com, 2017. All rights reserved.