HIGHER PREMIUMS HELP TT CLUB RESUME PROFITABILITY

HIGHER PREMIUMS HELP TT CLUB RESUME PROFITABILITY

   Higher premiums introduced last year have helped the U.K.-based Through Transport Club insurance mutual return to profitability, with a 2002 after tax surplus of $10.7 million, as compared to a loss of $40.2 million in 2001.

   Gross earned premiums for 2002 increased by 28 percent, to US$152.0 million,    from $118.5 million in 2001.

   The insurance club’s “technical underwriting result” improved to a surplus of $6.6 million in 2002, from a deficit of $28.9 million in the previous year. Investment income also improved, to a surplus of $8.3 million for 2002, from a deficit of $4.6 million in 2001. The club has sold its entire portfolio of equities .

   The TT Club said that its free reserves have increased by 27 percent, to $50.2 million, from $39.5 million a year earlier, and its “solvency ratio” has improved to 381 percent, from 158 percent.

   The TT Club said that it wanted to protect the club’s solvency last year from a further decline after the difficulties of 2001. It said that it has now achieved this objective.

   “The insurance industry suffered a very poor year in 2001 and the TT Club was not immune to the external factors affecting the industry generally,” it said.

   The managers of the TT Club have reduced the expense ratio (management fee plus expenses as a percentage of gross earned premiums) to 13.7 percent, from 15.8 percent in 2001.

   Paul Neagle, chief executive, said that much remains to be done to restore the TT Club’s financial health to its former level.