Marine insurance – vocabulary

term Definition
underwriter An underwriter is any party that evaluates and assumes another party's
risk for a fee. The fee is often a commission, premium, spread, or interest.
The term "underwriter" first emerged in the early days of marine
insurance. Shipowners sought insurance for a ship and its cargo in case the
ship and its contents were lost. Underwriters play a variety of specific
roles depending on the context. Underwriters are considered the risk
experts of the financial world. Investors rely on them because they
determine if a business risk is worth taking.
insurance broker A broker understands the client’s situation, needs and requirements of the
clients to find them the best insurance policy within their budget. An
insurance broker makes money off commissions from selling insurance to
individuals or businesses. Most commissions are between 2 and 8% of
premiums, depending on state regulations. Insurance brokers submit
insurance applications on behalf of clients, and insurance underwriters
review the application and decide whether or not to offer insurance
coverage.
general average General average is a term used in the maritime industry to define shares
in a common loss during maritime accident. It is a loss that arises from the
voluntary sacrifice of part of a ship or cargo to save the residue of the ship
or cargo or from extraordinary expenses incurred in protecting the
interests involved under pressure of a common risk and that is shared
proportionally by all parties concerned
to subcontract to engage a third party to perform under a subcontract all or part of (work
included in an original contract
freight forwarder a person or firm that arranges to pick up or deliver goods on instructions
of a shipper or a consignee from or to a point by various necessary
conveyances and common carriers
insurance coverage protection that is given by an insurance company when it agrees to pay
money if a particular thing happens, for example if someone is injured, or
property is lost or damaged
cargo insurance Cargo insurance provides coverage against all risks of physical loss or
damage to freight during the shipment from any external cause during
shipping, whether by land, sea or air. Marine cargo insurance is the most
common method used to protect the value of your goods from physical
damage, theft, or general average.
insurance policy A document detailing the terms and conditions of a contract of insurance.
institute cargo clause Institute cargo clauses come embedded in a marine insurance policy
which covers cargo in-transit. These clauses are there to specify what kind
of items in the cargo is covered in case of any loss or damage to the
shipment. It is interesting to note; institute cargo clause can cover
anything from the cargo to the container that holds its value along with
the transport mode which is used to ship the items.
washing overboard Washing overboard is the accidental loss of cargo or equipment
overboard.
comprehensive The cover that offers protection against various types of losses or
cover damages like a total loss of goods, partial loss of goods, related expenses
while still in transit, etc. It that financially protects any other vessels and
people that are involved in an accident with you, in addition to yourself
pilferage Pilferage is a theft of small quantities of goods or of low-value goods.
Pilferage often connotes small theft performed repeatedly over a long
period of time. Covering pilferage for marine operations is a high risk for
insurance companies. As a result, some marine insurance policies will list
pilferage as an exclusion. Cargo owners are, therefore, left to their own
devices and must take measures to prevent this theft from happening.
claim An insurance claim is a formal request by a policyholder to an insurance
company for coverage or compensation for a covered loss or policy event.
The insurance company validates the claim and, once approved, issues
payment to the insured or an approved interested party on behalf of the
insured.
insurance premium An insurance premium is the amount of money an individual or business
pays for an insurance policy. Once earned, the premium is income for the
insurance company. It also represents a liability, as the insurer must
provide coverage for claims being made against the policy. Insurers use
premiums to cover liabilities associated with the policies they underwrite.
annual policy Insurance cover that remains in force for 12 months, unless renewed or
cancelled earlier by the insured or the insurer.
marine insurance Marine Insurance assessor inspects and assesses the damage or loss to
assessor insureds property. He has the knowhow and experience to determine
whether it falls within the scope of a policy’s cover, which items or
damage need to be replaced or repaired, and what it will cost.
Marine insurance – vocabulary

term definition
[underwriter] is any party that evaluates and assumes another party's risk for a fee. The
fee is often a commission, premium, spread, or interest. The term first
emerged in the early days of marine insurance. Shipowners sought
insurance for a ship and its cargo in case the ship and its contents were
lost. He/she is considered the risk experts of the financial world. Investors
rely on them because they determine if a business risk is worth taking.
[insurance broker] He/she understands the client’s situation, needs and requirements of the
clients to find them the best insurance policy within their budget. He/she
makes money off commissions from selling insurance to individuals or
businesses. Most commissions are between 2 and 8% of premiums,
depending on state regulations. He/she submits insurance applications on
behalf of clients, and insurance underwriters review the application and
decide whether or not to offer insurance coverage.
[general average] a term used in the maritime industry to define shares in a common loss
during maritime accident. It is a loss that arises from the voluntary
sacrifice of part of a ship or cargo to save the residue of the ship or cargo
or from extraordinary expenses incurred in protecting the interests
involved under pressure of a common risk and that is shared
proportionally by all parties concerned
[to subcontract] to engage a third party to perform under a subcontract all or part of (work
included in an original contract
[freight forwarder] a person or firm that arranges to pick up or deliver goods on instructions
of a shipper or a consignee from or to a point by various necessary
conveyances and common carriers
[insurance coverage] protection that is given by an insurance company when it agrees to pay
money if a particular thing happens, for example if someone is injured, or
property is lost or damaged
[cargo insurance] it provides coverage against all risks of physical loss or damage to freight
during the shipment from any external cause during shipping, whether by
land, sea or air. It is the most common method used to protect the value
of your goods from physical damage, theft, or general average.
term definition
[insurance policy] A document detailing the terms and conditions of a contract of insurance.
[institute cargo They come embedded in a marine insurance policy which covers cargo in-
clauses] transit. They are there to specify what kind of items in the cargo is
covered in case of any loss or damage to the shipment. It is interesting to
note; they can cover anything from the cargo to the container that holds
its value along with the transport mode which is used to ship the items.
[washing overboard] is the accidental loss of cargo or equipment overboard.
[comprehensive It offers protection against various types of losses or damages like a total
cover] loss of goods, partial loss of goods, related expenses while still in transit,
etc. It financially protects any other vessels and people that are involved
in an accident with you, in addition to yourself
[pilferage] is a theft of small quantities of goods or of low-value goods. It often
connotes small theft performed repeatedly over a long period of time.
[claim] is a formal request by a policyholder to an insurance company for
coverage or compensation for a covered loss or policy event. The
insurance company validates it and, once approved, issues payment to the
 insured or an approved interested party on behalf of the insured.
[insurance premium] is the amount of money an individual or business pays for an insurance
policy. Once earned, it is income for the insurance company. It also
represents a liability, as the insurer must provide coverage for claims
being made against the policy. Insurers use them to cover liabilities
associated with the policies they underwrite.
[annual policy] Insurance cover that remains in force for 12 months, unless renewed or
cancelled earlier by the insured or the insurer.
[marine insurance He/she inspects and assesses the damage or loss to insureds property.
assessor] He/she has the knowhow and experience to determine whether it falls
within the scope of a policy’s cover, which items or damage need to be
replaced or repaired, and what it will cost.