North P&I and Standard Club Make Plans for Insurance Mega-Merger
North P&I and Standard Club are discussing the details of a merger to create one of the largest providers of mutual cover in the maritime industry. The combined club would provide cover for vessels totaling about 400 million GT.
“Standard Club and North now have the opportunity to create one of the world’s leading and most influential P&I clubs, founded on exceptional service and innovation, a broader diversified product range, scale economies and global reach," said Jeremy Grose, CEO of Standard Club.
James Tyrrell, the chairman of North, pointed to the opportunity to create a mutual insurer with greater financial resilience, strong enough to weather "a changing and sometimes volatile maritime sector." The merged insurer would have a stronger capital buffer, exceeding regulatory requirements.
Both insurers have secured the approval of their respective boards and have notified their regulators. A working group is exploring the details of the merger, and any final deal will be subject to approval by the insurers' full membership and all appropriate regulatory agencies. The timeline calls for a vote by May and completion of the merger by the end of next February.
"With histories which in 2022 add up to 300 years, the combination of these two unique advocates of mutuality, with their complementary cultures, ambitions and approaches, would build on the strengths of each club," said Paul Jennings, CEO of North.
The marine insurance sector has been challenged in recent years by a wave of outsize claims, driven by mega-ship disasters like Maersk Honam, Golden Ray and Ever Given. Insurers face pressure from a classic dilemma: the need to raise premiums in order to ensure the strength of their balance sheets, while keeping them low enough to be competitive.