Circular to all members
Skuld experienced a challenging policy year 2024 in terms of underwriting performance, driven by an elevated number of large claims, which was a common theme for most of the International Group of P&I Clubs.
For the first period of policy year 2025, the overall frequency of claims reported to the International Group has shown some degree of improvement, but the overall claims environment remains unsatisfactory, and as we transition through the last period of 2025, we expect to see claims activity increase.
The claims cost escalation in recent years is driven by large claims, and the lack of adequate premium to cater for the large claims element is concerning. This is observed on claims incurred within Skuld’s own retention, but perhaps more notably within the International Group pool layers. Adding on the increasing complexity of global trade and inflationary pressures, the conclusion is that there is insufficient premium to cater for all the eventualities the clubs are being exposed to and are expected to cover. Skuld’s growth in recent years and strong financial position help to absorb some of the volatility observed, and this emphasises the importance of continuing the growth ambitions going forward.
As the renewal season is approaching for the mutual portfolio, we will soon be able to start negotiations with our membership. At this renewal, and in common with our long-standing philosophy of not having a general increase, we will continue to focus on individual membership performance. At the recent Board meeting in Bermuda, the challenges faced by Skuld and the industry were discussed, and the Board have asked that Skuld secure an overall adjustment of 7.5% on premium rates to ensure the continuous strong financial stability.
Furthermore, all lower deductibles will be increased to minimum Skuld standard levels.
Any adjustments to the International Group excess of loss reinsurance program will be added separately.
RELEASE CALL 2026/27
The applicable release calls are presented below:
2023/24 = 7.5%
2024/25 = 10%
2025/26 = 15%
2026/27 = 15%
Yours faithfully,
Assuranceforeningen Skuld (Gjensidig)
Ståle Hansen
President and CEO