(www.MaritimeCyprus.com) For the Maritime industry, February revolves around protection and indemnity rather than Valentine's day. Every year, P&I policies renew on February 20th for a reason that remains a mystery to many.
Why don’t P&I renewals coincide with the calendar year, or renew randomly throughout the year like other policies? The answer goes back hundreds of years.
P&I clubs were originally formed in the 1800s by shipowners, ex-sea captains, and volunteer committee members to offer protection from liabilities resulting from the British Merchant Shipping Act of 1854. These mutual associations function by all members contributing to each other’s liability losses and offering “umbrella” protection to the group. This is the origin of P&I insurance, which protects shipowners from liability claims arising from crew, cargo, and third parties—these claims can include collision, wrecks, pollution, property damage, etc. In other words, P&I is insurance provided on a mutual basis.
20th of February is the date when the ice melts in the Baltic Sea. Those original P&I clubs established February 20th as the date to renew P&I policies. This was the unofficial first day of the "season" when sailing ships came out of winter hibernation and resumed their trade routes in the Baltic Sea. In short, tradition is the primary reason February 20 remains the P&I renewal date for the large majority of shipowners worldwide.
Yes, traditionally, that is the first day of the year the Baltic sea ports are clear of ice, and the merchant shipping year can begin. Of course climate change means the ice clears a lot earlier now, but the date remains.