LM1- Chapter 3

Question 1

common element covered by any type of marine hull insurance

Answer 1

damage to insured ship- physical loss (first loss)

Question 2

Physical damage to insured property defined as

Answer 2

‘particular average’

Question 3

What is the tail

Answer 3

time lag between insurance incepting and final closure of any claims under that insurance - short tail business has short time lag

Question 4

In terms of damage/claims what does maritime law state

Answer 4

each side must pay damages to the other ship that relates to its share of the blame

Question 5

builders risk insurance

Answer 5

combined physical damage and liability cover where insureds can be purchaser/owner/ combination

Question 6

Loss of earnings (marine)

Answer 6

typically requires physical damage to have occurred and it is important that this insurance does not cover loss of earnings merely because there is no work for the vessel to do

Question 7

cargo and goods in transit

Answer 7

cargo is physical damage insurance for items being moved, whereas in transit is primarily liability for the person or organisation moving them

Question 8

cargo insurance

Answer 8

90-95% of world trade by sea- covering physical damage to goods whilst they are on their journey- doesn’t cover liabilities for cargo damaging any persons

Question 9

stock throughput insurance

Answer 9

end-to-end pduct combining transit policy with storage policies removing gaps in cover between storage policy written by property/inventory insurers and transit written by cargo insurers

Question 10

jeweller’s block insurance

Answer 10

covering different property and liability risks covering aspects of business from manufacturing trade shows, exhibitions, retail - physical loss - inventory loss and dissapearance not covered

Question 11

fine art

Answer 11

paintings, scultuptures- cover cost of repair and also depreciation in value

Question 12

specie insurance

Answer 12

loss or damage covering gemstones, precious metals etc

Question 13

satellite pre launch

Answer 13

cargo insurers cover for loss and damage

Question 14

cash in transit

Answer 14

covering money between locations- risk preventions: varying routes, armed truck crews, mixing up crews, GPS

Question 15

goods in transit

Answer 15

liability of sea carrier in respect of goods being carried- doesn’t cover liabilities generally -

Question 16

war and strikes insurance

Answer 16

war and civil war type risks- captures and seizures. Piracy not included as a war risk in London Market but is covered as a main peril in hull wordings and widest cargo wordings
Strikes- damage caused by terrorists acting on political motive

Question 17

marine liabilities

Answer 17

Long-tail insurance (time period between insurance and final closures of claims)

Question 18

examples of marine liabilities

Answer 18

injury or death of other visitors to vessel
pollution caused by escape of cargo
damage to cargo being carried
dmaage doneto other peoples property

Question 19

collision liability

Answer 19

collision with other ships- removing wreck after incident, damage caused to vessel if they have hired or chartered

Question 20

Port authorities

Answer 20

damage to vessels caused harbour not free of obstructions or docks not secure
damage to vessels caused by shore cranes
damage caused by port authority tug boats
liability to cargo owners if they release cargo to wrong party
liability to neighbouring properties for pollution
liability to vessels for enginge damage if port provided substandard bunkers

Question 21

ship builders/ship repairers

Answer 21

liability for not repairing or building a vessel properly
liability for damage to other vessels following an avvident such as fire/explosion
liability for injuries to personel or visitors

Question 22

marina owners

Answer 22

liability for pleasure vessels damaged in marina
liability for individuals injured whilst on marina property
liability for injury caused by food or drink
liability for providing fuel or stores which aren’t correct standard

Question 23

Political risks insurance

Answer 23

manages risk arising from restrictions imposed by hostile govt actions
Subclasses of risks: CEND, CCCP, contract frustration risks
offers trade finance banks alterative to sharing out exposure to competitors

Question 24

offshore energy insurance

Answer 24

upstream:
exploration phase
construction phase
operational phase

Question 25

onshore energy market

Answer 25

downstream - covers elements of oil and gas industry midstream- covers pipelines and downstream covers refining and petrochecmial processing elements of business mining , power generation, hydroelectric, wind farms, solar energy and biofuel

Question 26

business interruption

Answer 26

physical loss or damage to insured property which triggers shutdown and loss of income

Question 27

contingency insurance

Answer 27

covering event cancellation, weather-related, prize indemnity, death and disgrace and over-redemption

Question 28

kidnap and ransom

Answer 28

covers medical expenses for the captured person once released payment of random provision of a specialist negotiation team to assist insured family

Question 29

aviation insurance

Answer 29

private pleasure fixed wing aircraft commercial fixed wing aircraft gliders drones

Question 30

aviation liabilities

Answer 30

passengers- injury occuring while boarding TP other than passengers-baggage handlers and ground staff products- illness from food, contaminated fuels

Question 31

loss of licence

Answer 31

relates to individual who has failed medical- not covering due to drinking etc

Question 32

airport operators' policies

Answer 32

premises liability- someone injured in duty free, yet if no negligence on part of insured there would be no claim Products- airport providing fuel hangar keepers- airport providing maintenance or storage

Question 33

Advance Loss of Profits (ALOP) and delay in start up (DSU)

Answer 33

marine: found in cargo insurance 'project cargo' items being shipped are large equipment- items are generally specialist- covers financial impact of project not starting on time Non marine: purchased as additional cover by companies buying CAR/EAR cover- triggered by delays due to physical damage occuring to assets which delays build process