In addition to professional indemnity cover, ITIC also offers a range of additional products including debt collection, loss of commission cover, cash in transit insurance and directors’ and officer’s insurance.
These additional risks are usually added by endorsement to the main policy.
In the last 20 years, ITIC has recovered more than US$ 145 million in unpaid commission, outstanding port disbursements, survey fees and other debts for ITIC Members. The insurance pays the legal costs of pursuing the debt. Tact and professional courtesy is vital in order to preserve commercial relationships. Often a polite reminder is all that is needed to secure payment. If legal proceedings are, however, necessary, ITIC’s specialist team will use whatever legal means necessary to try to recover the monies owed to you.
Loss of Commission Cover:
Loss of commission insurance is as essential for shipbrokers and ship managers as business interruption protection insurances are to other businesses. The loss caused by, for example, the sinking of a vessel on a long term time-charter could seriously diminish a shipbroker’s income. ITIC offers two types of loss of commission cover, the simpler being loss of commission resulting from the charterparty being terminated due to actual or constructive total loss of a vessel. The more comprehensive cover includes loss of commission due to a charterparty being cancelled for a wide range of marine perils, such as heavy weather, fire, piracy, collision, engine breakdown and negligence of master or crew. Insurance is offered either on an individual declaration of a charter, sale or purchase, or the more popular annual cover for all fixtures concluded throughout the year. In the latter case, there is no need to make any further individual declarations as all fixtures within the limit of liability are automatically covered.
Constructive total loss commission insurance
The shipbroker who fixed the M.V. MSC NAPOLI for a period charter lost its right to commission when the ship, which was famously beached on the south coast of the UK, was declared a constructive total loss. The shipbroker insured his commission with ITIC and the Club paid US$ 500,000 to the broker - the equivalent of the balance of the commission due over the remainder of the period charter. The shipbroker received his commission and had the advantage of it being paid up front.
Wider loss of commission insurance
A ferry on a regular route suffered many deficiencies, including engine breakdowns and machinery deficiencies and was often put off hire. Ultimately the charterers applied a clause in the charterparty which allowed them to terminate the charterparty due to the number of off-hire periods. The shipbroker had taken out ITIC’s full loss of commission insurance and therefore claimed for the remaining period in which they should have received commission against the insured peril of the breakdown of the engine or equipment. The commission lost totalled US$ 80,000 and was covered in full by ITIC.
Cash in Transit and Money Insurance
Shipowners often require their agents or managers to deliver cash to ships whilst in port. The risks are obvious. The ship agent or ship manager needs insurance to cover cash when it is temporarily in his custody, whether during transport to the ship, in a strong room at his office, or in a safe at home or on the managed ship. ITIC provides a product offering this combination of insurances which can be offered either on a single occurrence or annual basis.
Directors’ and Officers’ (D&O) Insurance
Directors’ & Officers’ insurance, or D&O, provides financial protection for the directors and officers of your company in the event that they are sued in relation to the performance of their corporate duties. ITIC’s D&O policy protects both individual directors from claims against them in person and also the company that has to indemnify them. It also includes, at no extra cost, coverage for employment practice liability claims from employees alleging discrimination, harassment, unfair dismissal, etc, as well as insurance coverage for the legal costs of responding to alleged breaches of corporate regulations, authority requirements or corporate statutory duties.
Please contact your client’s ITIC underwriter if you would like to receive a quotation for any of these products. You can find examples of claims paid out under such insurances in ITIC’s Knowledge Zone.