The publication of NorthStandard’s Annual Review demonstrates that the merger of North P&I and Standard Club is already providing a platform for financial stability and growth.
The first Annual Review published by NorthStandard as a consolidated business portrays an organisation rapidly engaging with the challenges and opportunities facing P&I and already broadening its service portfolio.
Established on 20 February, NorthStandard employs over 650 people in offices worldwide, has over 365 million GT of owned and chartered tonnage on its books, generating annual premiums of around US$800 million and has free reserves of US$685 million.
For 2022/23, its net combined ratio – the barometer of P&I club performance – was 95%. NorthStandard also reports combined specialty revenues as contributing over US$200 million towards overall 2023 premiums.
The marine insurer’s review notes that immediately after its formation in February 2023, S&P Global upgraded its rating assessment to ‘A’ with a stable outlook, reflecting NorthStandard’s improved operating performance and robust capital management, with a significant regulatory capital buffer and coverage of S&P’s AAA capital requirements.
“Even at this early stage, NorthStandard is delivering as a platform for stability, growth and diversification,” said Jeremy Grose, one of two Managing Directors leading NorthStandard. “We have brought together the best of the approaches on which North and Standard Club both built success in specialist covers such as Offshore & Renewables, Strike & Delay, H&M, Coastal & Inland, Fishing and Aquaculture. We have also strengthened our geographic reach with a new operating structure and wider office network, enhancing our ability to expand – particularly in Asia, the Middle East and the USA.”
“The NorthStandard business strategy is to build a diversified portfolio with a range of mutual and specialty products, delivering the broadest range of marine insurance solutions relevant to our members and clients and their operations worldwide,” commented Paul Jennings, fellow MD, NorthStandard. “As a Club, we benefit from the breadth of exceptional service and expertise as well as the financial stability that comes with a diverse portfolio and, over the last 12 months, we were particularly pleased to see the continued positive premium income contributions from specialty lines.”
Grose added, “our members and stakeholders can be confident in our growing financial strength, which allows us to recruit and retain the very best people in the industry, enrich our member services through investments in innovative technology and deliver more tailored and sustainable solutions for the future.”
The solid platform contrasts with a backdrop of war in Ukraine, global inflation and continuing supply chain disruption, and a P&I sector rising to the challenges of complex new sanctions while still seeking to recover ground against a decade of premium erosion. Both North and Standard Club sought General Increases at the P&I renewals.
“The challenges of securing this increase in a highly competitive market should not be underestimated, with shipowners and brokers extremely sensitive to increasing costs,” commented Thya Kathiravel, NorthStandard’s Chief Underwriting Officer.
While a small number of members elected to balance their entries across other IG clubs in response to the merger, many more enlarged their entries over the period. “Other members opted to increase their entries – in some cases, significantly,” Kathiravel notes. “Thanks to the ongoing support of our members, the overall rating increase achieved projections, and we successfully de-risked our overall exposure, with our total post-renewal premium revenues growing to over US$800 million.”
“The potential of what NorthStandard can deliver has started to excite the market, and we have received great interest for future business from brokers, potential members, and clients.”
Cesare d’Amico, Chair, NorthStandard, reflected on the pivotal role the International Group of P&I Clubs plays in helping shipping face its pressing challenges. “As one of the largest IG members, NorthStandard aims to lead the way – in helping members trade smoothly, but also to enhance seafarer safety and successfully transition to new environmentally responsible energy sources,” he said. “Our size and scale give us the opportunity to champion mutual causes, push boundaries and influence the industry’s future.”
To read or download the NorthStandard Annual Review 2023, please click here.
