FM announces $1 billion membership credit after clients slash loss exposure by $1 trillion

By David Bull

May 6 - (The Insurer) - FM has announced an “enhanced” $1 billion membership credit for eligible policyholders of the mutual, rewarding clients for reducing loss exposure related to property risk by an estimated $1 trillion last year.

The $1 billion credit this year means that the commercial property insurer will have returned more than $3.8 billion through its membership credit program over the last four years, and $7.5 billion since 2001.

In a statement, FM said it had partnered with clients to complete more than 46,000 recommended risk improvements, which had slashed loss exposure related to property risk by an estimated $1 trillion.

FM’s chairman and CEO Malcolm Roberts said: “The membership credit is a testament to the strong, enduring partnerships we form with clients and our work together to mitigate risk, protect their purpose and prevent losses before they happen.”

The amount of credit for individual policyholders is based on how long they have been with FM. The mutual is offering 5% credit for fewer than five consecutive years; 10% credit for at least five consecutive years but fewer than 10; 12.5% credit for at least 10 consecutive years but fewer than 15; and 15% credit for at least 15 consecutive years.

According to its latest annual report, last year FM grew in-force premium by 6.6% to a record high of $11 billion.

Its large commercial property business grew by 6.1% to $8.7 billion, while its FM Affiliated unit, which is positioned in the commercial property middle market, grew by 5.8% to $1.7 billion.

The mutual’s consolidated loss ratio for the year was 51.5%, significantly lower than the planned ratio of 71.6%. The insurer’s risk loss ratio in 2024 was just 26.7%, compared to budget of 40.6%, with its natural hazard loss ratio at 22.5%, below its plan of 27.3%.