Reinsurance arrangements for the 2023 policy year for P&I entries with Gard P. & I. (Bermuda) Ltd and Assuranceforeningen Gard – gjensidig – (hereinafter individually referred to as the “Association” and collectively as the “Associations”)
The overall structure of the cover reinsured through the Pool is the same as in the current year.
• Club retention: USD 10 million.
• Pool retention: USD 90 million (in excess of USD 10 million) in two layers:
o Lower Pool retention: USD 40 million (in excess of USD 10 million).
o Upper Pool retention: USD 50 million (in excess of USD 50 million).
• General Excess Loss Cover: USD 2,000 million (in excess of USD 100 million).
• Common overspill protection: USD 1,000 million (in excess of the underlying General Excess Loss Cover).
• Special limits:
o Oil pollution: USD 1,000 million.
o Passenger and seamen combined: USD 3,000 million.
o Passenger (sub-limit): USD 2,000 million.
The oil pollution limit applies to the aggregate of owners’ and demise charterers’ liabilities any one Ship arising out of any one event each owner’s entry.
The standard P&I cover for owners with regard to the passenger and seamen risks combined for all categories of ships shall be limited to USD 3,000 million, any one ship arising out of any one event.
A sub-limit of USD 2,000 million shall apply to passenger risks only.
As per the current year the overspill protection reinsurance has been bought by the International Group for claims up to USD 1,000 million in excess of the limit of the General Excess Loss Reinsurance. Although the limit on each mutual Member’s liability to pay an Overspill Call remains unchanged at 2.5 per cent of each entered ship’s Convention Limit as defined in Rule 5.4 of Appendix VI in the Rules for Ships, the combination of the limit on cover for passenger and seamen claims and the USD 1,000 million special overspill reinsurance protection reduces the exposure of all Members to an Overspill Claim.
Charterer’s Co-assured under an Owner’s Entry
For the 2023 policy year the overall limit of cover for charterers named as co-assured under an Owner’s Entry will increase from USD 350 million to of USD 500 million, a combined single limit for both pollution and non-pollution claims each incident or occurrence, each Ship each entry.
Special excess war risks P&I cover
The terms on which the special excess war risks P&I cover will be provided for the 2023 policy year are to a large extent the same as for the 2022 policy year. However, due to the ongoing war between Russia and Ukraine, the IG’s excess war reinsurers require a territorial exclusion clause for vessels trading in these waters, which will also be reflected in the terms of the special excess war risks P&I cover. The IG is negotiating availability of sub-limited cover for affected vessels and we will revert with further details in due course.
The limit of the cover is USD 500 million. The cover will only respond to claims in excess of the proper value of the entered ship as defined in Rule 71. 1. (a), deemed not to exceed USD 500 million, or whatever sum is recoverable from any other policy of insurance in respect of war risks, whichever is the greater.
This cover shall include liabilities arising from acts of terrorism as defined in the US Terrorism Risk Insurance Act 2002 as amended which has been extended to 2027. A premium of US cents 0.25 per entered GT is deemed to be attributable to the US risks in accordance with the terms of the Act.
The special war risk P&I insurance excludes loss, damage or expense arising from an act of terrorism which the Member may incur or for which the Member may be liable under TOPIA 2006.
Bio – Chem Risks and Computer virus
The detailed terms and conditions for Bio-Chem and Computer virus risks remain unchanged for the 2023 policy year
Special limit for owners
For the 2023 policy year the special P&I war risks cover for owners remains unchanged with a limit of USD 500 million any one event each Ship in excess of the proper value of the entered Ship or any amounts recoverable under any other P&I war risks cover which the Member has arranged, whichever is greater. The minimum excess is the proper value of the Ship determined in accordance with Rule 71.1(a) of the Rules for Ships or USD 500 million, whichever is the lesser. The cover is subject to a minimum deductible of USD 50,000 any one event each Ship.
Maritime Labour Convention (MLC) cover
The MLC market reinsurance cover is being renewed for 2023 at competitive market terms, with the premium included in the overall reinsurance rates charged to shipowners.
The main changes are:
Malicious Cyber, COVID and Pandemic risks
For Malicious Cyber, Covid and Pandemic risks there is free and unlimited cover for claims up to USD 650 million excess of USD 100 million, covering almost all Clubs’ certificated risks. Excess of USD 750 million there is up to USD 1.35 billion of annual aggregated cover in respect of these three risks. Excess of that the Group has decided to pool between Group Clubs the unreinsured risks, resulting in no change to Members’ cover.
The diagram below illustrates the layer and participation structure of the GXL programme for 2023/24.
International Group reinsurance rates for the 2023 policy year
The International Group reinsurance rates including Hydra premium, Collective Overspill Cover and excess war risks P&I for the year commencing 20 February 2023 are renewed and are as follows:
Development of the International Group reinsurance rates, 2014 to 2023