ANNUAL REPORT ANd FiNANCiAL STATEMENTS 20 February 2021 strategic report 1 Key performance indicators 2 Chairman’s statement 5 Financial review 6 Investment strategy and performance 8 Class 3 – Protection and Indemnity (P&I) 8Claims 9Tonnage/Membership 10International Group reinsurance 12Loss prevention 13Policy year development 14 Class 6 – Freight, Demurrage and Defence (FD&D) 14Claims 15Policy year development 16 Developments within britannia 18 Sustainability 19 Members of the board 20 Corporate governance 26 Statement of Compliance with Section 172(1) of the Companies act 2006 27 Statutory directors’ report 28 Financial statements 29 Statement of directors’ responsibilities 30 Independent auditors’ report to the Members 34 Consolidated income and expenditure account 35 Consolidated statement of financial position 36 Consolidated statement of cash flows 37 Consolidated statement of changes in equity 38 Company statement of financial position 39 Notes to the financial statements 56 Class 3 – Protection and Indemnity policy year statement CONTENTS THE BRiTANNiA STEAM SHiP iNSURANCE ASSOCiATiON HOLdiNGS LiMiTEd 3,912 53.5m 125.2m CHARTEREd TONNAGE SHiPS OWNEd TONNAGE 20 FEB 2021 20 FEB 2020 20 FEB 2019 (m gt) (m gt) (m gt) ENTEREd TONNAGE (OWNEd) 125.2 117.5 111.9 ENTEREd TONNAGE (CHARTEREd) 53.5 45.0 19.0 USd(000) USd(000) USd(000) CALLS ANd PREMiUMS 200,086 201,185 204,415 NET CLAiMS iNCURREd (118,257) (111,667) (119,599) iNVESTMENT iNCOME 58,970 61,868 (2,643) NET OPERATiNG EXPENSES (32,520) (31,891) (28,649) NET iNCOME AFTER TAXATiON 36,967 56,427 (9,296) FREE RESERVES* 449,055 422,088 390,661 NET LOSS RATiO 90.77% 79.89% 83.79% iG AVERAGE EXPENSE RATiO 11.66% 11.50% 10.90% STANdARd & POOR’S RATiNG A (stable) A (stable) A (stable) *The Group also retains the benefit of its reinsurance contract with Boudicca insurance Company Limited (see note 5 to the financial statements) . USd(000) USd(000) USd(000) SURPLUS ASSETS iN BOUdiCCA 177,800 172,300 196,900 Surplus investment assets in Boudicca available to meet future claims by the Group. 30 KEy FiNANCiAL dATA 247 MEMBERS COUNTRiES ENTEREd TONNAGE By AREA OF MANAGEMENT CLASS 3 (% OF TOTAL) A S i A S C A N d i N A V i A R E S T O F E U R O P E A M E R i C A S M i d d L E E A S T A U S T R A L A S i A 46.8 13.7 33.4 3.6 2.2 0.3 SHiPS By TyPE (% OF TOTAL) B ULK CARRiER/ O BO T ANKERS ( CRUdE) T ANKERS (OTHERS) CONTAiNERS GENERAL CARGO OTHERS ANNUAL REPORT ANd FiNANCiAL STATEMENTS 2021 strategic report 1 KEy PERFORMANCE iNdiCATORS AGE OF SHiPS (% OF TOTAL) 0-4 yEARS 5-9 yEARS 10-14 yEARS 15-19 yEARS 20 yEARS + 35 34 18 18 15 14 26 18 5 4 1 12 21 21 30 31 31 27 11 14 7 7 ENTEREd TONNAGE (OWNEd) WORLd TONNAGE Fortunately, markets recovered strongly towards the end of the year and the total economic impact on shipping, with the exception of cruise activities, was less severe than initially feared. The maritime industry deserves much praise for working through these difficult times and continuing to provide a fundamental service for the global economy. recently, some sectors have experienced a strong recovery of freight rates to acceptable levels which should contribute to improved financial stability and the ability to make the necessary investment for the future. britannia has been able to provide its Members with continuously high levels of service in spite of all staff in the uK and in many other locations around the world not being able to get to the office or travel as required in the nor