Marine insurer Skuld reports jump in 2016 profit

Skuld, a protection and indemnity (P&I) club for Scandinavian shipowners grew profitability in the 2016 financial year ending February 20, 2017 as the frequency of regular claims remained low and due to a “strong” return on investments.

Net profit was $51 million in the 2016 financial year before members’ credit compared to $18 million in 2015.

The marine insurance provider’s combined ratio for 2016 was 98 percent. Skuld experienced a few large claims but over the year the frequency of regular claims remained low which contributed positively to the 2016 annual result, the company said. Reported pool claims from the International Group of P&I Clubs have been low, reflecting a generally small level of large claims over the year.

Gross earned premium amounted to $403 million. Return on investments was 3.4 percent, driven particularly by the equity portfolio towards the end of the policy year, Skuld said.

“We have over the year demonstrated our casualty response service and our core competence in servicing members and clients in difficult situations,” said Ståle Hansen, Skuld president and CEO. “Financial strength is vital but what certainly stands out as Skuld’s competitive advantage is the strength of the service we provide.”

Skuld’s 2016 results are accounted for before the deduction of members’ premium credit, totalling $5 million, which will be returned to Skuld’s mutual members in 2017. The total transfer to Skuld’s contingency reserves will, therefore, be $46 million. Skuld’s contingency reserves are now at a record high level of $394 million, according to the firm.

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