The Club announces 7.5 per cent Premium Return for 2022
Norwegian Hull Club has announced a proposed 7.5 % return on premium (USD 13.6 million) in its Annual Report 2022 published today, 31 March 2022. This proposal will be presented to the Committee and finally decided at the Annual General Meeting, to be held on 13 June 2023.
As a mutual marine insurance provider, Norwegian Hull Club delivers various benefits to its members, including return of premium when the capital position and operating results allow. This is a recognition of members’ long-term commitment to The Club and their belief in the service concept as a driver for sustainability and saved costs.
In his CEO Review, Norwegian Hull Club’s Hans Christian Seim says that 2022 will be remembered 'as the year when war returned to Europe'. In addition to noting the war in Ukraine's effect on The Club's employees on a personal level, Mr Seim states that the wellbeing of seafarers, sanctions, and extraction from Russia have been particular concerns and challenges professionally.
‘Healthy financial year’
While expressing a desire to be 'humble while concluding the books for the year that has passed, given such a backdrop of geopolitical uncertainty, Mr Seim says: "2022 has … been another healthy financial year for The Club and, once again, we are in the position of having a profit that we can share with our members. The Board of Directors has proposed a return premium to Norwegian Hull Club’s members of 7.5 % for the calendar year 2022."
‘A more sustainable tomorrow’
Elsewhere in his review, the importance of sustainability and transparency to The Club is stressed. While noting an increase in alternative fuel and hybrid powered vessels in the portfolio, Mr Seim reiterates the commitment of Norwegian Hull Club to support its clients and members in their ongoing journeys towards zero emissions. He also highlights The Club's adoption of a leading position in such areas as offshore wind, as well as mentioning how the 'difficult decision' to cease P&I business in 2022 enabled greater focus on growing other segments.
The Club’s belief in transparency – applicable to both itself as an organisation and to the industry as a whole - is emphasised. Membership of initiatives including the Poseidon Principles for Marine Insurance – of which The Club is a founding signatory - and the Maritime Anti-Corruption Network, reflect The Club’s standing on the importance of increased transparency to the pursuit of ‘a more sustainable tomorrow’ for all.
The welfare of crew-members is also emphasised. The insight provided by The Club’s subsidiary Marine Benefits – via its crew wellbeing surveys – is proving invaluable in understanding and tackling industry crewing challenges. Mr Seim says: “Their 2022 survey resulted in responses from close to 25,000 seafarers and revealed that as many as 12% of the respondees are considering leaving the industry – a result that emphasises that this issue calls for immediate action, as crew shortage is already a challenge. We will contribute through offering services which focus specifically on seafarers’ health and wellbeing which, subsequently, could also increase retention rate.”
Summing up his review, Mr Seim says of The Club: “I am confident that our strong position, capital base and expertise in managing risks mean we will not only weather any storm, but that we have the courage to continue to support and grow our portfolio together with our clients, both today and tomorrow.”
Return Premium - practical information
In order to be able to proceed with the payment of return premiums as quickly and efficiently as possible following the Annual General Meeting, The Club requires endorsements and closing documents on all 2022 business (at risk in 2022). We therefore encourage clients and brokers to provide such outstanding documentation as soon as possible.
An e-mail with all the underlying details will be sent to brokers and members in June 2023 and Norwegian Hull Club will then start paying out the return premium as soon as accounts / any outstanding amounts have been reconciled. If you have any questions regarding the return premium, contact your designated underwriter or check the Q&A section listed below.
Q: Which article in the Articles of Association is the basis for decision on and calculation of return premium?
A: Return premium is regulated by § 3-2 of the Articles of Association, stating:
“If the total premiums and other income of The Club are found to be in excess of that required to cover the claims and costs of the calendar year, The Club may decide that the surplus, wholly or in part, shall be repaid to the members in the calendar year in question by way of a pro rata discount to be stipulated in proportion to the net advance premiums for that calendar year. It is not permissible to declare higher return premium than proposed or accepted by the Board of Directors. Repayment to Joint Members is to be sent to the member named first in the insurance agreement.”
Q: For which period is the return premium earned?
A: Return premium is based on mutual premium earned by Norwegian Hull Club during the 2022 calendar year, see § 3-2 referred to under the first question. This premium can also relate to previous underwriting years which were at risk in 2022.
Q: To whom shall return premium be paid?
A: Return premium shall be paid to the member, See § 3-2. Where applicable, payment to the member will be made through their broker.
Q: Will return premium impact commission to brokers?
Q: Will a former member who was member for a part of the calendar year be entitled to return premium?
A: Yes, see § 3-2.
Q: Is estimated but not reported premium on war covers included in the basis for return premium?
A: No, only calls declared, and premium calculated thereon form the basis for return premium.
Q: When will repayment of premium be made?
A: Shortly after the Annual General Meeting’s approval, to be held on 13 June 2023.
Dated: 31 March 2023