Real Life situation:
We were negotiating the renewal of a fleet of vessels with a well-known Hull Insurer on behalf of the shipowner.
The Hull market internationally was very tough indeed then. The existing Hull Insurer required some large premium rises in addition to increases in the level of deductibles. During that period, all shipowners had to pay an increase in hull premium despite of clean claim record.
On behalf of the shipowner, we approached all the international hull insurers for quotations for comparison to ensure that our client is getting absolutely the best deal.
After comparison, we confirmed that the existing insurer is offering the most competitive quotation. Nevertheless, we still proceed to negotiate for rate reductions. At the end, we managed to shave off the premium increase substantially.
In addition, the existing insurer was able to offer English ITC, Norwegian and Swedish Insurance conditions at the same premium. The vessels were insured on ITC conditions.
We investigated each of these different conditions and obtain extra cover for the client with the same premium. In addition, we drafted Owners’ supplementary clauses (Rider Clauses) to amend sections originally unfavorable to the shipowner. We discussed and negotiated with insurer to include these Rider Clauses in the Standard Hull policy. Some examples are coverage of Fixed and Floating Objects and 4/4th RDC Collision claims. After which, we obtained a good refund of Call premium from the P&I Club as these are the risks are normally insured by them.
The overall effect of our actions, our client resulted in no increase in total premium after the refund from P&I Club and enjoyed a wider coverage at the same time.