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The P&I World in Transition Present Trends, Future Challenges and the Shape of Things to Come Joseph E. M. Hughes S

The Houston Marine Insurance Seminar 2010. The P&I World in Transition Present Trends, Future Challenges and the Shape of Things to Come Joseph E. M. Hughes Shipowners Claims Bureau, Inc. Managers of The American Club. September 21, 2010. Overview A brief retrospective

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The P&I World in Transition Present Trends, Future Challenges and the Shape of Things to Come Joseph E. M. Hughes S

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  1. The Houston Marine Insurance Seminar 2010 The P&I World in Transition Present Trends, Future Challenges and the Shape of Things to Come Joseph E. M. Hughes Shipowners Claims Bureau, Inc. Managers of The American Club September 21, 2010

  2. Overview A brief retrospective Dominant themes of the present Major challenges of the future The shape of things to come Conclusion

  3. A brief retrospective 30 years of geopolitical change 30 years of economic change 30 years of P&I change But….an enduring business model

  4. Dominant themes of the present A fragile global economy The rise of emerging markets, especially China Volatile asset values A spotty freight market Leviathan rises: statism in the ascendant Widespread regulatory intervention Marine liability claims down Healthier P&I results A better balanced underwriting equation No clear economic direction

  5. Major challenges of the future Global economy retreats into “double-dip” recession Protectionism gains ground Asset values slump Shipping crisis provokes erosion of industry base Unanticipated rise in claims costs Pricing power weakens as deflation sets in Burgeoning shipowner liabilities Increasing regulatory/political intervention Shipping industry expectations expand and regionalize No clear systemic pattern

  6. The shape of things to come Political and regulatory challenges will grow and regionalize Member/shipping industry expectations will continue to rise Flexibility/value of system will continue to be recognized The Club/Group business model will endure Group will maintain its basic shape Cooperative deployment of Group resources will strengthen Growing emphasis on financial modeling Group market share will be maintained Regionalization of service delivery will expand Specialist insurers will continue to have a role

  7. Conclusion • P&I market texture much changed over years • Serious challenges persist, but no clear pattern/direction • P&I market fabric enduringly strong over years • Underlying Group business model will remain • Reflects desires/expectations of customer base • Plus ça change, plus c'est la même chose

  8. The Houston Marine Insurance Seminar 2010 The P&I World in Transition Present Trends, Future Challenges and the Shape of Things to Come Joseph E. M. Hughes Shipowners Claims Bureau, Inc. Managers of The American Club September 21, 2010

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