P&I Clubs have stable outlook despite losses

P&I Clubs are still failing to write an underwriting profit although the situation is improving according to a review of the market by Standard and Poors. Rowena Potter, credit analyst S&P says the market’s combined ratio has improved over the last three years with 2002-2003 figure at a six year best of 112%: “Further improvements are also expected for the years ending February 2004 and 2005, although the market is not expected to reach an acceptable combined ration level until year end February 2006,” she comments. S&P is predicting a combined ratio of between 105-110 when the year closes next week.

Ms Potter describes 2004 as a ‘turning point’ for the industry as the improved underwriting profits are combined with stronger investment returns which will enable an increase in free reserves across