OUTLINE

• 2007 policy year closed with no further supplementary premium
• No further supplementary premiums estimated for the 2008 policy year
• Free reserves and capital (including hybrid capital) increased to US$409 million

TO THE MEMBERS

Dear Sirs

POLICY YEAR REVIEW
REVIEW OF OPEN POLICY YEARS2007 Policy Year

At their meeting in April 2010 the Directors decided to close the 2007 policy year with no further supplementary premium. In October 2008 when the Directors decided to set a supplementary premium of 25 per cent in order to minimise the deficit on the 2007 policy year, the deficit then stood at US$83 million. Following the supplementary call and based on the latest claims projections, the anticipated deficit on the year has reduced to US$8.7 million.

2008 Policy Year

No further supplementary premium is estimated for the 2008 policy year.

2009 Policy Year

Claims on the 2009 policy year are lower than the three previous claims years despite a heavier year than 2008 for Pool claims. No supplementary premium is estimated for this year.

Financial Year Highlights

The Directors, at their meeting, approved the Report and Financial Statements for the year ended 20th February 2010. A detailed summary of the Club's financial results is contained in the separate publication "Review of the Year" accompanying this circular; highlights include an increase in free reserves and capital to US$409 million.

Yours faithfully

THOMAS MILLER (BERMUDA) LTD.CONTACT

Members requiring further information should contact their usual Club contact.

Visit the

UK P&I Club website

.