Other commercial Policies

hull coverage (ocean marine insurance)

- Physical damage or loss of the ship itself - the ship while it is in transit

Return of Premium

- applied on a pro rata basis upon a change of ownership of vessel. - will be returned on a pro rata basis for each 30 day period laid up in port or not under repair, not being used for storage or lighting - If insurer cancels policy, pro rata refund is due - If cancelled by assured a SHORT RATE refund is due

Electronic Data Processing

- coverage for businesses that own, lease, or rent data processing equipment - unfiled forms covering computers, processing media, extra expense, business interruption

Bailee's Customers

- covers losses to customers' property in the care, custody, or control of the insured. - unfiled form - Ex: dry cleaners, when you (bailor) drop your clothes off at the dry cleaners (bailee)

Commercial Articles

- filed form that covers the interest of the owners, as opposed to the dealers, of commercial cameras, musical instruments, and similar property, including similar property of others in the insured's car, custody, or control. - additional acquired property is automatically covered for up to 30 days if it is of the same type of property already insured - insurer will pay up to 25% of the limit of insurance for similar property, to a max of $10,000.

Accounts Receivable

- most important and popular of the inland marine coverage filed forms - coverage is provided for property that is at a fixed location, rather than mobile property - provides protection for losses of accounts due from customers that become uncollectible because of a loss to the insured's accounts receivable records. - written on an all -risk open peril basis - additional exclusions: alteration, falsification, concealment, destruction of records, bookkeeping, accounting, billing records, electrical or magnetic injury, disturbence, or erasure.

Contractors Equipment Floater

- unfiled form that generates more premium industry -wide than other other commercial inland marine coverage - insures mobile equipment and contractor's equipent owned, rented, or borrowed by contractors - coverage can be written on name or open peril - Newly Acquired Property is covered up to 60 days that is similar to the type already insured. This coverage is usually limited to 25% of the limit of insurance or $50,000 whichever is LESS

Sue and Labor Clause

-The master and crew is required to Sue and labor to prevent further loss and keep losses as small as possible. -The insurance will pay reasonable expenses in doing so. -If mastering crew do not Sue and labor to prevent further lost the insurer could refuse to pay the clean

Claims General provisions

-The underwriters have the right to appoint their own survey or to determine the extent of the damage -The underwriters have the right to decide where the vessel will proceed for repairs and have the RIGHT TO VETO any repair firm proposed - If the underwriters drag the vessel to proceed to a particular port for repair the INSURER will pay for the expenses of doing so including wages and maintenance for the master officer and crew

Filed Forms - a form require an insurer to file for rate and form approval

1) Accounts Receivable 2) Camera & Musical Instruments Dealers 3) Equipment Dealers 4) Film 5) Floor Plans 6) Fine Arts 7) Jeweler's Block 8) Mail Coverage 9) Physicians and Surgeons Equipment 10) Signs 11) Theatrical Property 12) Valuable Papers and Records 13) Commercial Articles

Unfiled Forms - may not require an approved filing to the insurance department in that state

1) Annual Transit 2) Trip Transit 3) Air Transit 4) Parcel Post 5) Motor Truck Cargo 6) Air Cargo 7) Bridges and Tunnels 8) Radios and TV Towers 9) Laundries and Dry Cleaners 10) Furriers Block 11) Cold Storage Locker 12) Processors Legal Liability 13) Contractors Equipment 14) Warehouseman's 15) Bailee's Customer 16) Pattern and Die 17) Salespersons Samples 18) Exhibition Floater 19) Processing Risk 20) Garment Contractors 21) Builders Risk- Installation 22) Installations 23) Fine Art Dealers 24) Stamp/Coin Dealers 25) Electronic Data Processing

Nationwide Marine Definition defines 4 general classes of risks that may be the subject of Inland Marine coverage. These risks are:

1) Domestic shipments and transportation risks 2) Bridges, tunnels, and other instrumentalities of transportation and communication 3) Commercial property floater risks 4) Personal property floater risks

4 implied warranties of the voyage:

1) legal conduct- it is warranted that the venture is not illegal (all activities must be lawful and not involve contraband, smuggling, or any other illegal activity) 2) seaworthy vessel- it is warranted that the vessel is seaworthy and capable of making the voyage; the master and crew must be competent, and the cargo must be sound and properly packed 3) prompt attachment- since weather conditions may affect the risk involved, the underwriter has a right to assume that insurance purchased now will be used now and not be providing coverage on goods to be shipped 6 months from now 4) Change in voyage- it is warranted that the vessel will proceed without deviation by the most direct or customary route. The master of the ship may change courses only to protect the vessel and/or cargo. Prudent changes to avoid loss and humanitarian deviations will not affect the coverage. Ex: if a storm develops, the voyage may be altered o sail around the storm for the safety of the ship and crew. These implied warranties, while not written into the contract, are as binding as the warranties that are written. Breach of implied warranties may void the contract.

Protection and Indemnity (P&I) insures the ship owner against liability:

1) to seaman for injuries resulting from unseaworthiness of the vessel and other negligent acts; 2) to stevedores (laborers who load and unload vessels in a port), longshoreman, and harbor workers 3) for cargo lost or damaged by negligence 4) for damage to other property, including fixed objects; 5) for damage to other vessels not caused by collision

The American institute of Marine Underwriters (AIMU) Contain the following clauses

1)Warehouse to warehouse or transit clause 2)craft clause 3)change of voyage clause 4) constructive total loss 5) general average 6) seaworthiness admitted 7) bailee clause 8) not to insure clause 9) theft, pilferage and non delivery 10) malicious damage 11) dangerous drug

Change of ownership the coverage Automatically terminates unless:

1. At the time the is ship is at see with cargo, the coverage terminates UPON arrival to the final port 2. In the event of involuntary temporary transfer by requisition or otherwise, without prior written consent of the ASSURED. The automatic termination will be 15days after transfer

The 4 major types of ocean marine polices are

1. Hull 2. Cargo 3. Freight 4: Protection and indemnity (P&I)

In Ocean Marine insurance, who pays all reasonable expenses if suing labor is required to lessen a loss A)The Insurer BThe master CThe crew D The assured

A

What is the purpose of increased value and excess liability (IVEL)? A) To provide extra coverage for the same losses coved by an underling policy B) To protect an assured from errors and omissions of his or her insurance agent C) To protect the insurer from inflation D) To protect the master and crew of a vessel for being sued

A

Taylor Hull Form

A hull form widely used to insure towboats, barges, and other vessels that operate on the inland and coastal waters of the U.S.

Containerization cargo is better protected resulting in?

A lower premium

Actual Total Loss

A total loss of a vessel or cargo that occurs when the property undergoes physical destruction, loss of specie, or irretrievable deprivement.

A unique feature in a bailee form is that it covers A) The building occupied by the insured whether it is owned or leased B) Customer's property whether or not the insured has been negligent C) Fire and theft loss to the insured's stock held for sale without any deductible D) All loss and has no exclusion

B

An individual's construction company leave mobile equipment and construction machinery on the job sit until the project is completed. What could this individual use to insure it? A) General property form B) Contractors equipment floater C) Bailee's customers form D) Builders risk form

B

Bulk carriers are used to transport A) Containerized cargo B) Loose cargo C) Break-bulk cargo D) Motor vehicles

B

Most American Institute hull policies are written with a coverage term of ASix months BOne year CTwo years D For the time period of the voyage

B

The a I HC for the return of premium will reply if a vessel has been laid up in Port not under repair, and not use for storage. The premium will be returned four AEach 10 day. B each 30 day. C The first 10 day only D the first 30 day only

B

Methods of packing Cargo

Bulk commodities Break-bulk cargo Containerzation Roll on or off

According to the nationwide marine Definitions, risk that may be the subject of inland marine insurance include all of the following EXCEPT A) Shipments made by freight train B) Cargo transported by truck C) large pleasure boats D) Property while stored at a warehouse

C

As you leave the dock in your yacht, you carelessly cut in front of another yacht, causing its crew to change course. They run into a buoy damaging their boat. What coverage takes care of the damages? A) The coliiosn clause of your hull policy B) The other boats hull policy C) Your P & I D) Your inchmaree clause

C

If a pillage and towing firm is responsible for damage done to a vessel while the vessel is under its control, who is liable for the damage? A) The insurer of the vessel B) The vessel's owner or managers C) The insurer of the pilotage and towing firm D) The vessel's assured

C

In accordance with AIHC, a pro rata return of premium will be given for all following reasons EXCEPT A) In the event of termination under the change of ownership B) if policy us cancelled by the underwriters C) If the policy is cancelled by the insured D) For each period of 30 consecutive days the vessel may be laid up in port not under repair

C

The implied warranties that apply to Ocean Marina policies A) Apply to the insured's representations made on the application B) Guarantee insurability in the event of a change in destination C) Are not actually written in the contract D) Only apply to the P&L coverage

C

The term used to describe the cost and charges associated with the transfer of goods from one location to another is? A) Cargo B) shipping C) Freight D) transfer

C

Which inland marine coverage condition states that payment of any claim will not reduce the limits of liability, except in case of a total loss on a scheduled item? A) Privilege to adjust with the owner B) Trainer fo rights of recovery C) Reinstatement of limit D) Legal action against the insurer

C

Containerization

Carry packed cargo in 20 to 40ft containers that can be moved by trucks, railcars. This is the more efficient in cargo handling resulting in Shorter port times.

Cargo Insurance

Covers loss or damage to the cargo. The owner of the cargo certifies the cargo is suitable for shipment. Amount of premium is partly determined by 1) Packing method used, 2) partly the type of ship providing transformation

Coastwise and inland Hulls Clause (CIHC)

Covers ships on the high seas, coastwise vessels and vessels on inland water ways

According to the principle of ocean marine insurance, an actual total loss may occur in all of the following situations EXCEPT A) When all property has been destroyed B) with loss of species C) when insured is irretrievable deprived of all property, even though not destroyed D)When cargo is misplaced

D

All of these are excluded losses under ocean marine policies EXCEPT A) Demurrage B) War & strikes C) Intentional acts of assured D)Jettison

D

An ocean marine adventure is A) A measure of indemnity B) A pleasure cruise C) Loss or damage D) Any voyage

D

In marine policy which of the following is referred to as the "amount insured hereunder?" A Detectable BThat agreed value CThe duration of risk DThe limit of insurance

D

What is no a consideration when pay an inland marina claim? A) Cost to replace the property B) Actual cash value on date of loss C) Cost to repair or restore the property D) Market value when the portent was first purchased

D

What type of ocean marine insurance provides physical damage coverage for the ship while it is in transit? A cargo B freight C protection and indemnity(P&I) D Hull

D

Which of the following is NOT true if ownership changes voluntary or otherwise? A) The ocean marine policy shall terminate at the time of ownership change B) If the vessel already has sailed from her loading port, automatic termination may be deferred until arrival at the final port of discharge C) If involuntary temporary transfer occurs without prior written agreement by the assured, automatic termination shall occur 15days after transfer D) If the vessel already has sailed form her loading port, automatic termination may be deferred until 15days after arrival at final port of discharge

D

Break bulk cargo is not protected well resulting in?

Higher premiums

Assured

If payment is made to anyone other than the owner of the vessel. It will be made to the extent that the owner would have collected - It contains waiver of subornation to related entities of the assured

Constructive Total Loss

In Ocean Marine insurance, a loss that occurs when property is not completely destroyed but the cost to salvage or repair the property would exceed its value

The difference between Inland and Ocean Marina -

Inland Marina - Exposures pertaining to property located on LAND Ocean Marina - Property being transported over WATER

Average

Means loss

Agreed value

Most hull policies written. Insurer and insured agree upon the value of ship AT THE TIME the contract is made. If total loss this amount is paid

Warehouse to warehouse or transit clause

Names the points of the voyage. Insurance coverage applies form the time the goods leave a warehouse until: 1) Goods delved to final warehouse or place of storage named on declaration 2) Goods delivered to another warehouse or storage which the assured choose for storage other than ordinary course of transit 3) Allocation or distribution 4) 60days after discharge( 30days for air shipment) from vessel 5) 15days after discharge at the final destination port If goods not forwarded insurance remains until goods are sold.

Dangerous Drug clause

No claim will be paid in respect to drugs to which various international conventions relating to opium and the dangerous drugs apply unless the drugs are expressly declared in the policy. The importing/exporting countries are state and the route by which drugs are conveyed is usual and customary. Proof of loss must be accompanied by a license, certificate, or authorization issued by the government.

Cargo policies may be written on a trip or voyage basis. For a frequent shipper an open cargo basis.

Open policy would cover all the insured cargo a a specified amount of time or a special number of shipments

The IVEL Clause provides excess coverage for

P&I Collision Tower liability General average and salvage sue & labor Ship repairers liability, charterers liability Wharfingers/ safe berth liability other as specified

Partial loss - particular vs general average

Partial loss could be a particular average in which those involved in the loss are affected General average in which all those involved in the voyage share in the loss

Particular

Partical

Sue and Labor Expenses

Policy will pay the labor cost of crew to protect cargo from further loss

Nationwide Marine Definition

Statement of the types of property that may be insured on inland marine and ocean marine insurance forms. Inland Marine should be differentiated fro Ocean Marine, which covers property being transported over water. Inland Marine exposures pertain to property located on land.

Freight Insurance

The indirect loss that an insured would suffer if insured cargo is lost or damaged. Losses include: income generated or charges paid to transport such cargo. Freight charges are PREPAID, in which case coverage would be attached to the cargo policy purchased by the cargo owner. Freight charges can also be paid on DELIVERY in which case the ship owner could purchase coverage to be attached to the hull policy.

Increased value and excess liability clauses (IVEL)

Works as an umbrella policy. They re excess or the same losses covered by an underling policy. The underlining must pay up to the limits before the IVEL will pay.

Adventure

a Trip or voyage

Protection and Indemnity

a form of Liability insurance that protects the owner of the ship from consequences of his or her negligent acts of the negligent acts of his agents. If the owner should be liable from a third party the P&I will protect against financial losses by paying those sums that would be legally liable to pay for damages. P & I can be written as a stand alone or added to a policy

Nonpayment of premium

after 30 days in-force policy can be cancelled by the underwriter within 10day' notice to assured or broker. - If a total loss occurs prior to the cancellation, the full annual premium will be earned

Misfortune

an accident or occurence

Deductibles (deductible average clause)

any deductible will be expressed as a dollar amount in the policy. Deductible does not apply to total losses

Touching

applying to

General-cargo ships are used to transport

break-bulk cargo Things like steel, rolls of wire, boxed goods. Loading and off loading is SLOW because each piece is moved individually.

Commercial Inland Marine Coverage

can be written as: 1) monoline policy 2)commercial package policy (CPP)

Bulk carriers are used to transport?

coal, grain, phosphates, and other loss cargo. The ship itself is the container for the cargo. Tankers are sued to carry liquid cargo such as oil

Change of Voyage Clause

continuous coverage in case of change of voyage or of an omission or error in description of vessel, subject to payment of ADDITIONAL premium

The craft clause provides

coverage for the cargo while being transported to or from the vessel in another craft, raft, or lighter.

Vessel

covered for physical Damage or loss by hull policy. - Equipment owned by others and installed on the ship will be covered. - No coverage for cargo containers

Theft, Pilferage and Non-delivery

covers these types of losses even if the crew is responsible

American institute Hull clauses(AIHC)

created to establish wording to be used in marine policies int order to suppress confusions. Written on a 1year term.

malicious damage clause

deliberate damage to or destruction of property Insured because of the wrongful act of any person

Protection and indemnity (P&I) insurance

for liability

cargo is used to describe the physical good that are being shipped form one place to the other

freight is used to describe the sarges made to the ship cargo form place to place

General Average Clause

give rules to be followed to settle Bernal average claims and salvage charges

Filed coverages

have standardized coverage forms; form may require an insurer to file for rate and form approval

Duration of Risk

hull polices could be specified period of time for a voyage

Laid up

in port or at anchor

Demurrage

is the delay of vessel beyond the normal tie to on-load or off-load or charge for the delay

Ocean Marine

is the oldest type of insurance

freight coverage (ocean marine insurance)

loss of revenue if the ship owner cannot deliver the cargo

Unfiled coverages

present a unique exposure to loss and in which standardized forms have not been developed; may not require an approved filing to the insurance department in that state.

not to insure clause

prohibits the Assured from assigning any right of recovery in the policy to the carrier or any other bailee

Commercial floater

refers to an inland marine policy designed to cover movable commercial property, wherever it may be located (worldwide coverage)

Premium

stated in the policy and is fully earned in the event of a total loss

Seaworthiness admitted clause

the assured and underwater agree that the vessel is seaworthy. In the event of a loss, the Assured an still collect even thought the loss may have been caused by a wrongful act or misconduct of the ship owner or crew

Constructive Total Loss Coverage

the expense to repair or recover exceeding the value or policy limit

Assured

the insured

Amount insured hereunder

the limit of the insurance

Loss Payee

the party to be paid by the insurer in the event of loss. The loss payee could be a mortgagee or lean holder

bailee clause

the sassier to file a claim against a third party who may be liable for the loss

Loss of species

the subject matter ceases to be a thing of the kind insured

RO-RO Ship (Roll on roll off)

used to carry motor vehicles, which roll on and off the ship via stern ramp

cargo coverage (ocean marine insurance)

what the ship is hauling

Adventure clause

when a vessel is covered or not. It will be covered during period of the policy WHILE AT SEA, IN DOCKS, WHILE TOWING OTHER VESSELS IN DISTRESS, TRIAL TRIPS, AND SAID WITH OR WITHOUT PILOTS