Marine insurer Michael Else is to stop writing fixed premium protection and indemnity (P&I) cover after blaming soft market conditions and increasing reinsurance costs.

The decision, taken shortly before the February 20 renewal, affects the insurer's Lloyd's Dragon P&I policy for fixed premium P&I cover offered to shipowners. Dragon is to be placed into run-off.

Michael Else said it also feared the reward for the risk of continuing with Dragon had become too marginal.

“Persevering could have led to serious complications in the future and this was considered to be an unacceptable risk to the operation of other successful brands under Michael Else's control,” it said.

The company is to focus on its transmarine and charterers P&I club products instead.

Michael Else is in talks with the North of England P&I club over the possible transfer of its dragon policy clients.

Greg Carter, senior director at analysts Fitch, said: “During a soft market the number of insurers writing fixed premium business increases. One or two have been forced to stop writing larger business as they do not have access to adequate reinsurance capacity.”