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Press Release: Steamship Mutual Financial Update and 2021/2022 Renewal

London, 27 May 2021

At their Board Meeting held on 25 May 2021, the Directors of Steamship Mutual approved the Clubs’ Report and Accounts for the 2020/21 policy year and authorised publication of the following key points in advance of the release of detailed results.


  • Free Reserves remain in excess of US$ 511 million despite the challenges presented in 2020
  • At renewal approximately 5.7 million GT of new tonnage entered the Club from both existing and new Members
  • 2021 opening entered tonnage stood at 177 million GT
  • The Club achieved a 4.5% increase on renewing owned business
  • International Group Pool and Covid claims raised the combined ratio higher than expected to 125.4% with the average combined ratio for last six years at 99.2%
  • Investment return of US$ 54.2 million (4.8%)
  • The Club’s capital remains comfortably in excess of the S&P AAA rating level
  • Release call levels were unchanged
  • 2018 policy year closed

Financial Results

The Directors noted the pressure on the underwriting performance from higher than expected Pool claims, both in the 2020 policy year and in prior years, and Covid related claims. These two aspects apart, all other claims for the 2020 policy year were broadly in line with, or better than, budget.

Gross investment income in the 2020/21 financial year was US$ 54.2 million (4.8%). The portfolio recorded positive gains across all asset classes.

Over the year, free reserves decreased only moderately from US$ 515.3 million to US$ 511.1 million, still maintaining an amount comfortably in excess of S&P’s AAA rating level and ensuring the Club has one of the strongest solvency capital ratios in the International Group.

2021/22 Renewal

The Board decided upon a 5% general increase. At renewal, owners’ premium, including the value of adjusted terms, increased by 4.5%. Approximately 5.7 million GT of new owned mutual business was entered at renewal. This new tonnage was drawn from a wide cross section of geographical areas including Greece, Japan, Singapore, Cyprus, Germany, Hong Kong, Spain and UAE.

The Club Chairman, Mr Armand Pohan, commented:

“The 2020/21 financial year combined ratio was 125.4% compared to 99.8% in the preceding year. Nevertheless, the free reserves were similar in both years: US$515 million for 2019/20 and US$511 million for 2020/21. At renewal approximately 5.7 million GT of new tonnage entered the Club from existing and new members. As was the case in 2019/20, investment income in the 2020/21 policy year was once again significantly higher than projected, at US$55 million. The Club’s capital strength remains comfortably in excess of the S&P AAA rating level. The objective so far as the combined ratio is concerned is to achieve underwriting balance in each financial year. The 6 year average including the 2020/21 financial year is 99.2%.

“Even if balance is unlikely to be achieved every year, it remains a reasonable objective and the measure of underwriting achievement. In the last financial year, the Club experienced the effect of the worldwide pandemic, and made appropriate provision for it. 2020/21 was extraordinary in this respect, as well as in many others, and the combined ratio outcome for that year results from two factors. First, the necessity to take a conservative approach towards projected pandemic claims. Second, the effect of claims in the IG pooling layers which were experienced at record levels. These factors resulted in a higher combined ratio than would otherwise have been the case, and the directors required a 5% general increase for the 2021/22 year”.

** ENDS **

Notes to Editors:

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For further details relating to the Club’s key statistics, financial highlights and updates concerning underwriting, reinsurance, claims, safety and loss prevention, please see Steamship Mutual’s 2020 Management Highlights, which can be accessed here.

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