FIRST DECADE OF OPERATIONS MARKED BY STEADY GROWTH AND SOLID PROFITABILITY
SUSTAINABLE APPROACH TO BUSINESS AUGURS WELL FOR CONTINUING SUCCESS
NEW YORK, JULY 14, 2021: Eagle Ocean Marine (EOM), the American Club’s facility providing fixed premium protection and indemnity (P&I) and freight, demurrage and defense (FD&D) cover to the operators of smaller vessels in regional trades outside the US, recently celebrated ten years of service to the maritime community.
EOM began operating as an American Club underwriting facility on July 1, 2011. It has just completed its first decade of operations on a high note, having enjoyed steady growth and solid profitability over recent years. The commencement of EOM’s eleventh year has also been marked by the successful renewal of its reinsurance arrangements, supported by the continuing commitment of first-class security at Lloyd’s and elsewhere, a reflection of EOM’s excellent track record and the sustainability of its business model.
Over the forthcoming months, EOM’s gross premium income since inception is projected to surpass $100 million, with revenue over the last three years in particular having seen a compound annual growth rate of approximately 17%. Total premium earned for the most recent year of account is expected to be about $17.6 million, compared with just over $15 million for the immediately preceding twelve months.
As EOM continues to gain traction throughout the world as a gold-standard insurer in a changing fixed premium P&I landscape, there are grounds for optimism that its market footprint will continue to expand. Moreover, notwithstanding chronic rating softness in the marine liability insurance sector, EOM has had success in obtaining sustainable levels of pricing for the cover it provides, a token of the respect with which the quality of its service is viewed within the industry.
As to its underwriting results, EOM has continued to perform well over the recent past. The facility’s historic combined ratio since inception remains at about 75%, with an even better result over the last three years. Most importantly, EOM continues to contribute positively to the American Club’s mutual membership, whose overarching interests animate EOM’s prudent approach to risk selection and premium pricing.
The distribution of EOM’s insured tonnage by reference to domicile of management and vessel type is broadly based, and has remained relatively constant over recent years. With 1,700 vessels with an average unit size of 1,700 gross tons, EOM’s business derives from the major centers of maritime enterprise across the globe, with a strong representation from the Asia-Pacific region. As to vessel type, the dry cargo and small craft sectors make up the preponderance of tonnage at 50% and 33% respectively, with tankers (at 14%) accounting for most of the remainder.
Commenting on Eagle Ocean Marine’s first ten years, Joe Hughes, Chairman and CEO of Eagle Ocean Agencies, Inc., which manages the facility on behalf of the American Club, said: “My colleagues and I take great pleasure in celebrating the first ten years of EOM service to the maritime community. The steady growth of EOM’s market footprint and premium revenue, coupled with its continuingly profitable contribution to the American Club’s mutuality, are testament to its prudent approach to risk selection and premium pricing, as well as the respect of the market for the quality of its services. In an uncertain landscape, EOM remains the gold standard for fixed premium P&I insurance. We have every reason to view the commencement of EOM’s second decade of operations with great optimism for the sustainability of its business model.”
ENDS
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Eagle Ocean Agencies, Inc., is a member of the New York-based Eagle Ocean Group of companies – North America’s leading provider of mutual management, underwriting, adjusting, claims handling, surveying and loss consultancy services to the international shipping and insurance communities.