Page 13: of Marine News Magazine (January 2013)

for example, is a work in process but is fast becoming a standard for the maritime industry. Complimenting the RCP is the ISM Code which will result in a hybrid safety management system. The jury is out as to what the long term effect of the new Subchapter M on vessel owners/ operators, but we are encouraged that safety is a real hot button to be taken seriously by all. Underwriting rates are always important. Where are rates today; especially in comparison to one year ago and where do you see them going in the near term? What?s driving all of that? Rates are ß at to +10 on average. However, catch a cash ß ow underwriter at the right time and rates could be all over the map and generally lower. However, those types of underwriters attract a certain buyer and not generally one who prefers quality over price. While there is some talk of hardening, especially on the excess liability side of the business, the primary rates seem to be holding steady year over year. Claims costs are not getting lower and operational costs are increasing thus, you would think that higher rates must follow suit. Unless there is a meaningful increase in reinsurance costs generally resulting from a string of large catastrophes, primary carriers are not likely to raise prices in double digits. The insurance market has lots of capacity and as such, rates are hard to rise in such an environment. Remember, marine insurance represents 1/10th of 1 percent of the worldÕs insurance premiums. We are but a microorganism within a giant industry. Underwriters push safety and LTI benchmarks as a way of keeping rates low and rewarding those clients who can do it. How do you foster that culture? We are a leader in what we do; proactive within our specialty group and we think that our claims management and payment performance has few peers. Low rates are often times equated by some as ÒcheapÓ rates. What we aspire is a win-win relationship and a level playing Þ eld over time. Our clients know they can count on us, as their underwriters, to work closely with them in all areas MN 13www.marinelink.com MN Jan2013 Layout 1-17.indd 13MN Jan2013 Layout 1-17.indd 131/2/2013 3:15:50 PM1/2/2013 3:15:50 PM