Main classes of insurance written in the London Market

Question 1

What is marine insurance?

Answer 1

Generally insurance related to the sea.

Does extend policies to cover perils not to do with the sea.

Question 2

What is the marine version of Business Interruption (BI) insurance?

Answer 2

Loss of earnings insurance.

• e.g. when the vessel cannot carry passengers, transport cargo, hire vessel to others.
• Max indemnity for loss of earnings insurance calculated by info provided by the insured.

Question 3

What is first party insurance in marine?

Answer 3

Damage to the insured ship which makes this a physical loss.

Question 4

What is cargo insurance?

Answer 4

Coverage for physical damage to cargo.

Does not cover liabilities for the cargo damaging any persons or their property.

Question 5

What is cargo and goods in transit insurance?

Answer 5

Liability insurance for the person or organisation moving the items around.

Question 6

What is ‘stock throughput’ insurance?

Answer 6

Combines a transit policy with storage policies thus removing the danger of gaps in coverage between a freestanding storage policy.

Benefit goods both moving and being held in storage for a significant amount of time.

Generally written in the marine market.

Question 7

What other areas are covered under marine insurance?

Answer 7

1. specie insurance
2. jeweler’s block insurance
3. fine art insurance
4. political risks insurance
5. war and strikes insurance
6. cash in transit insurance
7. goods in transit insurance

Question 8

Name some marine third-party liabilities.

Answer 8

1. Damage to other people’s property by the vessel colliding with them
2. Pollution by escape of cargo, wastewater, or the vessel’s fuel (oil spill)
3. Marina owners
4. Ship builders/ship repairs

Question 9

What is another word for ‘offshore’ and ‘onshore’ energy?

Answer 9

‘offshore’ = (‘upstream’)
‘onshore’ = (‘downstream’)

Question 10

What does ‘offshore’ energy insurance cover?

Answer 10

The extraction of oil and gas under the sea bed.

Hence, ‘upstream’ = extracting oil and gas up out of the ground.

Hence, it is covered under the marine market.

Question 11

Name the 3 phases of ‘offshore’ energy?

Answer 11

(ECO)
1. exploration
2. construction
3. operational

Question 12

What markets operate ‘offshore’ and ‘onshore’ energy?

Answer 12

Offshore = marine

Onshore = non-marine

Question 13

What does ‘onshore’ energy insurance cover?

Answer 13

Onshore (downstream) energy is the product preparation and usage of the extracted materials.

E.g. manufacturing, refining, wholesale and retail.

Question 14

What is the difference between ‘offshore’ and ‘onshore’ energy?

Answer 14

Offshore = is the extraction of oil and gas.

Onshore = the preparation and usage of oil and gas.

Question 15

What are pecuniary insurances?

Answer 15

Insurances covering monetary loss rather than physical loss or damage

Question 16

Name some non-marine liability insurances?

Answer 16

1. employer’s liability
2. public liability
3. professional liability
4. motor liability
5. general liability

Question 17

What does ALOP and DSU stand for? And what do they do?

Answer 17

ALOP = advanced loss of profits insurance

DSU = delay in start up insurance

Insures risks of loss of profit should projects overrun or not be completed on time.

Question 18

What is Aviation insurance?

Answer 18

Physical damage insurance for all types of aircraft. Does not include wear and tear.

Question 19

Name some aviation liabilities.

Answer 19

1. passengers (only while on plane)
2. Third parties other than passengers (bag handlers)
3. Products related liabilities (illness from plane food)

Question 20

What does a ‘short tail’ class of insurance mean?

Answer 20

Short-tail classes of insurance have a short time lag between the policy period and the
final claims being concluded.

Question 21

What does a ‘long tail’ class of insurance mean?

Answer 21

Long-tail classes have a longer time lag between the policy period and the final claims
being concluded.

Question 22

Are personal accident policies policies of indemnity?

Answer 22

NO. Personal accident policies are benefit policies. (cannot be indemnified)