Marine Insurance I

Vocabulary flashcards covering core definitions, risk categories, and coverage types from the Marine Insurance I lecture.

Risk (in maritime)

The uncertainty concerning a possible port sector, defined as the potential of loss (an undesirable outcome) resulting from a given action, activity, and/or inaction.

Peril

The cause of loss, which includes events like stranding, sinking, collision, fire, piracy/barratry, thieves, and jettison.

Perils of the Sea

Causes of loss specific to maritime transport, explicitly listed as stranding, sinking, collision, and extra ordinary heavy weather.

Perils on the Sea

Causes of loss that occur during a voyage but are distinct from sea actions, such as fire, piracy/barratry, thieves, and jettison.

Insurable Loss

An undesired and unplanned reduction of the economic value of an item, classified as either direct or indirect.

Hazards

Conditions that increase the frequency or the severity of losses, which can include moral and morale hazards.

Technical Risks

A category of shipping risks that attach specifically to the ship herself and its equipment on board.

Financial Risks

Shipping risks usually imposed by project financing methods, particularly acquisitions and capital gearing (the ratio of equity capital to borrowed funds).

Commercial Risks

Shipping risks related to trading activities and economic developments affecting ship operations, primarily in the form of freight rate volatility, competition, and port delays.

Political Risks

Shipping risks related to international or national operational standards, or risks arising from countries engaged in world trade, such as the outbreak of war or warlike conditions.

Liability Risks

Shipping risks relating to third-party claims arising from contractual relationships (e.g., cargo owners, crew members) or non-contractual tortious acts (e.g., collisions or damage to port facilities).

Risk Management

The logical development and carrying out of a plan to deal with potential losses in order to manage an organization's exposure to loss and protect its assets.

Loss Control

Risk management activities designed to mitigate the cost of loss, which include risk avoidance, loss prevention, and loss reduction.

Risk Financing

Risk management mechanisms that determine when and by whom loss costs are borne, including risk assumption, self-insurance, financed risk retention, and risk transfer.

Hull & Machinery (H&M) Insurance

Marine insurance covering damage to a ship due to mishaps such as crashes, collisions, or piracy attacks.

Cargo Insurance

Marine insurance providing coverage to cargo against damage, loss, or misplacement.

Freight Insurance

A branch of marine insurance that covers the loss of freight.