Shipowner mutuals covering marine third-party liability: third-party damage, pollution, crew, cargo.
Protection and indemnity clubs are shipowner mutuals that cover the civil liability tied to ship operation: bodily injury to crew and passengers, marine pollution, damage to port installations, liability for carried cargo, wreck removal costs. This liability, distinct from the ship damage covered by hull cover, can reach considerable amounts, particularly in the event of an oil spill. The clubs operate on a mutual principle: member shipowners reinsure each other and within an international group that pools very large losses, allowing high cover limits to be offered. This mutual structure is a historical feature of the marine market. For reinsurance, the clubs' pool is a major buyer of capacity on catastrophic liabilities, and regulatory developments on pollution and shipping decarbonisation are reshaping the risk profile covered.
After an oil spill caused by a ship, the owner's P&I club covers the clean-up costs and third-party claims, pooled above a threshold.
P&I clubs, protection and indemnity, clubs de protection et d'indemnité, mutuelles d'armateurs