In contrast with the sort of cover provided by Lloyd’s underwriters and the commercial insurance companies (collectively referred to as “the market”), the P & I Clubs are invariably non-profit-making. They have no outside shareholders and are in effect owned by the shipowner-members themselves who are acting both as assureds and insurers. The Clubs derive their income from the members by means of advance and supplementary cash “calls” – the equivalent to the premium under conventional insurance – and any revenue which is surplus to immediate requirements is carefully invested. On the expenditure side claims are paid, management costs are incurred and re-insurance is arranged through the market for the major catastrophe situations. Each Club is controlled by a board of Directors, drawn from the senior management of the shipowner- members of that Club. The Club Directors meet regularly to examine and approve members’ claims, to monitor the investment programme and to consider how the scope of the cover being offered by the Club can be improved for the benefit of all. Day to day management of the Club’s affairs is vested with a permanent staff or with a professional management company employing experienced claims handlers, the lawyers, underwriting specialists, etc. A further special feature of P & I Club cover is that, with the exception of pollution liabilities, there is no upper limit to the level of indemnity provided. Another point about P & I Clubs is that their payments of claims are indemnity, that is to say that they reimburse (indemnify) their members against claims paid by the members to third parties, they do not take over the claim, as do insurance companies. This has caused problems in the USA which has laws permitting direct action by the claimant against the insurers (if the defendant is considered financially weak or un-contactable). As P & I Clubs are not insurance companies, action against them in this context has hit obstacles.