p& i club

Role of Correspondent &

An Overview on P&I Clubs

Meena Mathews

P&I Regional Manager - Middle East / Business Manager

TOPICS OF DISCUSSION

What is P&I ?

The International Group.

The scope of P&I Cover.

Service to Members of the P&I Club.Role of a Correspondent.

Qualities of a good P&I Correspondent.GAC.

What is a P&I Club ?

History of P&I Club.

WHAT IS P&I ?

P = PROTECTION (OF INTERESTS)

&

I = INDEMNITY (REIMBURSEMENT)

WHAT IS A P&I CLUB

Mutual, non profit making, liability insurer for shipowners and charterers against third party liabilities relating to the use and operation of ships.

Annual renewal of all IG Group Club is on 20th February.

General Rule “Pay to be Paid”.Premium and Investment income = Claims Payments and administration costs.

Mutual means fair sharing of liabilities of each other.

HISTORY OF P&I CLUB

P&I Insurance developed in London since the 1850’s.

Not available under standard Hull & Machinery (H&M) Insurance.

Rapid growth in trade. Greater liabilities.

THE INTERNATIONAL GROUP

The thirteen principal underwriting member clubs of the International Group of P&I Clubs (“the Group”) between them provide liability cover (protection and indemnity) for approximately 90% of the world’s ocean-going tonnage.

Although individually competitive, the International Group of P&I Clubs brings together the collective influence of mutual clubs as a force for security and stability in international maritime trade.

There are also various Fixed Premium Clubs that insure P&I risks but they cover liabilities to a limited extent and is a profit making institution.

WHY DO WE NEED P&I COVER?

DO YOU AGREE WE NEED P&I COVER?

THE SCOPE OF P&I COVER

•Liabilities in respect of seamen, supernumeraries, passengers and other third parties.

•Stowaways.

•Diversion expenses.

•Life salvage and persons in distress.

•Quarantine.

•Liabilities arising from collisions.

•Non – contact damage to ship

THE SCOPE OF P&I COVER

•Damage to Property •Pollution

•Wreck Removal

•Towage

•Liabilities in Respect of Cargo

•General Average

•Fines

•Legal Costs

SERVICE TO MEMBERS OF THE P&I CLUB

P&I Clubs provide their shipowners and charterers members with incident and claims handling services through a worldwide network of correspondents.

ROLE / DUTIES OF A CORRESPONDENT

•On call 24 hours a day, 365 days a year, to respond to incidents and claims.

•Appoint surveyors

•Provide initial guidance and advice to ship Masters following a casualty.

•Instruct lawyers

•Notify the P&I Club / Members

•Update the P&I Club regularly and offer guidance on how to solve problems – Be Proactive !

•Knowledge and good relation with local experts such as surveyors, lawyers, flag state representatives, etc.,

ROLE / DUTIES OF A CORRESPONDENT

•All and every action must be taken by a Correspondent to protect Club / Members interests.

•Must be equipped to respond effectively and efficiently to any major causality.

•The local “ears and eyes” of the Club and its Members.

•Arrange security for claims by way of P&I Letters of Undertaking or Bank Guarantees.

•Contingency plans are essential and must always be in place and documented.

•Be liaison between local authorities and Club / Members.

•Good contacts with local Authorities and Port officials.

•Good relationships with cargo interests and cargo insurers.

QUALITIES OF A GOOD P&I CORRESPONDENT

•Correspondents are considered to be the local experts

•Good financial reputation.

A “Mr. Fix”

•Provide relevant information regarding changes to local laws or statutory requirements.

•Correspondents play an important role in Loss Prevention by advising Clubs appropriately.

GAC

GAC represents all of the IG Group Clubs in one port or another in the ME and are also listed by most of the Fixed Premium and Hull Insurers. We were first listed as correspondents in 1973 and since then have grown to be one of the largest P&I networks in the ME region.

Serving, to the best of our ability, our Principals by continuously improving the quality and value of our services and achieving higher levels of productivity through efficient management and a highly motivated workforce.

GAC are committed to:

EVERY INCIDENT IS A LEARNING EXPERIENCE !

THANK YOU !