West of England Protection & Indemnity Club is seeking a 5% increase in P&I premiums at the next renewal round, and more from owners with adverse loss records, its members have been informed in a circular.

Claims costs are higher than last year but remain within the forecast range, the marine mutual added.

Premiums for freight, demurrage & defence — effectively, legal expenses insurance — remain frozen.

West is now the third International Group affiliate to unveil its pricing strategy for next year, with Steamship Mutual looking for 5% across all classes of business, offset by a 12.5% cashback on renewals, and Gard after a targeted 4% rise in premiums, with a 10% owners’ general discount.

Most commentators expect rate hikes to cluster in the 5%-7.5%, marking the seventh success year of inflation-busting increases. Modal average increases came in at 7.5% in 2020, 10% in 2021, 12.5% in 2022, 10% in 2023 and 7.5% in 2024.

West said that claims on the International Group Pool have increased after two years of benign experience, with 11 reported claims as at the end of October.

But West’s exposure is mitigated by the club’s own pool performance, which will reduce its percentage share of pool payouts under the formula used by the IG to make such determinations.

Back-year claims experience has been mixed, with projections having to be increased slightly.

Total premium is expected to come in at around $350m for the year. West’s combined ratio is forecast to be just over 100% at year end, which entails a small deficit on its technical underwriting performance.

Investment returns as of October 20 stood at 5.1%, with free reserves forecast to increase to around $320m.

Capital is expected to further increase at February 2025, to a solvency ratio in excess of 200%.

“Despite the club’s strengthened capital position, the board recognised that premium is insufficient to meet expected future claims and operating costs as inflationary pressures continue. The board is also mindful of the increased pool activity,” the circular said.

The release call has been set at 15% for the 2025/26 policy year, and rates will be adjusted to reflect any changes in the cost of the International Group reinsurance programme, which looks likely to rise sharply in the wake of the Baltimore bridge collapse.