Marine insurance

Document description

Marine Insurance is a vast subject and the aim of this paper is to provide background that will assist in understanding the principal features of the business. The paper examines each main class of business, Hull, Cargo & Specie, Liability and Energy, highlighting actuarial issues. The introductory section describes the market place, outlining how business is written and gives details of market organisations associated with Marine. It also covers some recent developments in the market, the way Marine business is accounted and key features on reserving. For each class there is an outline of the main types of cover provided. This is followed by a detailed study of the key area of rating, both at risk and class level. It looks at the main rating factors, possible exposure measures, traditional approach to rating and possible actuarial methods. This analysis is necessary even though the market place will be the final decider of the price to be charged, this being particularly so in a worldwide market with the UK share written on a subscription (slip) basis. We discuss how better data capture and enhanced analysis could improve the understanding of the past and likely future performance of the business, notwithstanding the problems caused by the diverse nature of Marine business, the international nature of Marine business, the size in terms of premium income written in the UK and the variety of problems should provide a challenging opportunity with potentially high rewards for the actuary.