Reinsurance contract structure for 2025/26 policy year finalised

The group maintains three private placements.

The International Group of P&I Clubs (IG) has finalised its Pooling and Group Excess of Loss Reinsurance (GXL) structure for the 2025–2026 policy year. 

This arrangement allows IG Clubs to provide extensive, free, and unlimited coverage for most of the risks they insure.

After two relatively benign years for pool claims during the 2022–2023 and 2023–2024 policy periods, the 2024–2025 policy year has seen an increase in claims activity, returning to levels more in line with the 2019–2021 period. 

Notable incidents, such as the Baltimore Bridge incident, have contributed to this rise. Additionally, the group's reinsurance partners faced challenges during an active hurricane season.

The GXL structure includes multiple layers of coverage. IG maintains three private placements, which account for 25% of Layer 1 in the programme. 

Layers 2 and 3 include separate aggregated coverage for specific risks, such as malicious cyber incidents and pandemics. These risks are covered up to $650m on a free and unlimited basis for claims exceeding $100m. 

Beyond this threshold, separate annual aggregated covers of $1.35b apply for malicious cyber risks and pandemic/COVID-19 claims, covering amounts from $750m to $2.1b. Any excess of these aggregated covers is pooled within the IG, ensuring no changes to shipowners’ coverage.

The IG's Reinsurance Committee has maintained the existing vessel category system for cost allocation, with adjustments to rates to reflect potential variations. The main GXL placement continues with three layers and a $1b Collective Overspill cover above the GXL. 

Hydra, the IG’s Bermuda-based reinsurance captive, retains an annual aggregate deductible in Layer 1, with the value unchanged from the previous policy year in 100% terms. Hydra plays a critical role in supporting the IG, enhancing pricing stability for shipowners.