Page 20: of Maritime Logistics Professional Magazine (Q1 2011)

Maritime Risk

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20 Maritime Professional 1Q 2011 already has a maritime background and then teach the basics of marine insurance. This is not to say that good marine bro- kers cannot gain the necessary skills without working in the maritime industry outside of insurance, but it takes a long time to learn about marine risks by reading or hearing about them in an office or visiting vessels in port.


Marine insurance is also subject to the doctrine of

Uberrimae Fidei which is Latin for “the utmost good faith”.

This doctrine imposes an obligation on those seeking marine insurance to disclose all material facts and not to misrepre- sent those facts. Failure to comply may void coverage, and the courts have frequently enforced this doctrine to the disap- pointment of vessel owners. This is just one more reason why it is important to work with a professional marine insurance broker who can identify what is material to the underwriting of the risk. When a risk is presented to underwriters, all the cards have to be on the table face up, and while those vari- ables should be presented in their best light possible, the facts are not to be distorted.

No matter how good the individual marine broker may be, it is necessary to have the support of a strong brokerage firm too. For instance, having a strong marine claims department, preferably with an Average Adjuster, to work as an advocate for the client is particularly helpful with subscription policies where each insurer has his own claims adjusters. Without the skill of a seasoned claims representative, getting all the dif- ferent claims adjusters to agree on an adjustment can be like herding cats.

A brokerage’s claims department should not only assists clients in the presentation of claims, but should also be able to provide each client with quarterly loss runs to keeps clients advised of activity and allow for claim reserves to be ques- tioned. This information can also aid in identifying trends in claims.

Ideally, the brokerage will have a marine loss control engi- neer who can then assist the Assured in interpreting claims trends and help develop changes that will correct negative trends. These may consist of specialized training for employ- ees and crew and/or the addition of physical safeguards.


A few good brokerages have regulatory consultants who can get answers to questions without drawing the spotlight of the regulatory agency onto the client. For example, consult- ants may be able to help clients with oil spill response plans and oil transfer plans. Some have assisted clients in the devel- opment of individual Responsible Carrier Programs that have been certified by the American Waterways Operators (AWO) as meeting or exceeding their RCP standards. One even helped a shipbuilder get the Coast Guard to drop a require- ment for the installation of expensive fire retardant insulation in the hull of an inspected passenger vessel. The Coast Guard


The Author

Bill Davis, CIC, ARM, is Senior Vice President & Marine Practice

Group Leader at Wells Fargo Insurance Services. Bill is responsible for overseeing and managing a broad base of marine clients. He joined

Wells Fargo Insurance Services in 1986, and in 2009 was named “Marine Power Broker” by RISK & INSURANCE magazine. He can be reached at Bill.Davis@

Maritime Logistics Professional

Maritime Logistics Professional magazine is published six times annually.