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Member, Beacon International Group, Ltd.
LONDON--London-based mutual transportation insurer the TT Club has posted a $40.2 million loss for 2001, compared with a $383,000 deficit for 2000.
The TT Club said the loss was in large part due to a $23 million reserve strengthening that was made for an expected increase in claims for 1999 and 2000. The mutual insurer writes property and liability coverage for international commercial transportation risks, including trucking.
In a statement, the TT Club said that the high number of low-value claims being seen for the 1999 and 2000 years had led it to set a "conservative level of reserves for unreported claims in relation to the 2001 year."
The statement said that while the TT Club had no direct exposure to the large catastrophes of 2001, it had suffered from soft market conditions over the past few years. Average rate increases of 40% over the fourth quarter of 2001 had been needed to restore rating levels to an acceptable level, it said.
The TT Club announced that it had signed a five-year quota-share reinsurance arrangement with Swiss Reinsurance Co. to protect against future claims volatility. No details of that deal were immediately available.