ITIC in the news: A century of support: ITIC at 100

A century of support: ITIC at 100

It’s been 100 years of successfully chasing shipbrokers’ commissions and ship agents’ disbursements for ITIC. Charlotte Kirk, ITIC’s Commercial Director and Mark Brattman, ITIC’s Claims Director, outline the history of the business and share the plans for remaining relevant for the next 100.

Looking back to move forward

The origins of ITIC can be traced back to 2nd December 1925, with the formation of The Chartered Shipbrokers Protection Association. Created by senior members of the Institute of Chartered Shipbrokers, the Association was a response to a practical challenge: recovering unpaid commissions. Legal proceedings were expensive, so the solution was a mutual defence association, similar to those already established for shipowners. The aim was to support shipbrokers and port agents by sharing the cost of legal services.

By 1937, the Association had been formally incorporated as a non-profit under the Companies Act 1929. ITIC continues to operate on a mutual, not-for-profit basis for the benefit of its members today. In fact, in the spirit of mutuality, ITIC returns excessive funds, in the form of a continuity credit to members each year.

It became apparent by the end of the 1930s that shipbrokers also required insurance cover against claims for professional negligence. The minutes of the Association recorded in September 1938 noted that:

“A case recently arose in which members had by inadvertence used a wrong clause and omitted an important clause from a charter-party. They were advised that they were exposed to a claim by the owners for damages for negligence in case anything should happen on the voyage, in respect of which the proper clauses would have protected the owners. They were also advised and were, fortunately, able to insure the risk, but it cost them the brokerage.”

A separate Class II Indemnity cover was created for this purpose. At the same time, the name was changed to The Chartered Shipbrokers Protection & Indemnity Association Limited to reflect this wider role.

Similar claims still occur today, but for more substantial amounts. Very recently ITIC received a claim where there was an allegation made against the broker for their failure to match the same terms for the new fixture they arranged with the underlying Contract of Affreightment (what is known as “back to back” clauses). Their failure to include the correct clause meant that the new fixture required the charterer to name both the ports AND the rotation within ten days of loading. However, the underlying fixture only required the ports to be named within ten days, with the rotation not required to be given until much later. When the underlying charterer changed the rotation after almost 20 days (as they were entitled to do), the new charterer tried to do the same. The new owner declined, stating it was too late to change the rotation. Eventually, the new owner agreed to the change in rotation but only for a substantial additional freight payment. The new charterer paid this and claimed it back from the broker. The cost of doing so was more than US$100,000.

Back in the 1920s, the cover was a modest £2,000 per claim and £20,000 annually. The annual subscription was just one guinea (£1.05).  Nowadays, ITIC can offer limits of up to $30 million per claim. The largest claim ITIC has paid for a shipbroker’s negligence stands at US$5 million.

Growth and global reach

During the 1960s, the need for similar support beyond the UK became clear. Overseas ship agents and brokers faced the same risks and challenges. In response, a parallel association was established: The International Ship Brokers & Agents P&I Club Limited (ISBA Club). The two eventually merged to create the Chartered and International Ship Brokers Protection & Indemnity Association Limited (CISBACLUB), under the management of Tindall Riley.

In 1992, CISBACLUB merged with Transport Intermediaries Mutual Insurance Association Ltd. (TIM), which had been founded by Thomas Miller in 1985 to provide liability insurance across a wider range of transport intermediaries, including the emerging profession of ship management.

The result of the merger was a stronger, more broadly encompassing mutual called International Transport Intermediaries Club (ITIC).

Fast forward to today, with ITIC supporting over 3,600 members in more than 100 countries, offering specialist professional indemnity insurance, risk management advice and debt collection services. Since 1992 alone, ITIC has recovered over US$250 million in unpaid commissions and disbursements for its members.

A century of support

In addition to insurance cover and debt recovery, ITIC actively supports its members through comprehensive risk management advice. This includes reviewing contracts in respect of liabilities, advising on standard trading conditions and helping to identify potential liabilities before they arise. By offering tailored advice and access to practical guidance, ITIC enables members to trade with greater confidence and clarity.

While ITIC’s purpose of protecting members has remained unchanged for the last 100 years, the context in which it operates is evolving rapidly. Digitisation, automation and new ways of working are reshaping the roles of all transport professionals. ITIC ensures it stays at the forefront of such developments, to enable support to be provided when needed. However, despite these changes, fundamentally, many of the issues we see regarding negligence haven’t changed in 100 years, although the method of communication may have changed; it is the broker who makes the mistake. Many years ago, a broker may have sent a letter, telex or a fax to the wrong counterparty, or only faxed one side of a two-page document. More recently, they may have sent an email to an incorrect address or attached an incorrect file or a file that was too large to be received. Now, there may be problems with apps and newer communication channels, such as WhatsApp or WeChat. However, despite the changing technology, human error remains constant throughout.

Faces of the future

As part of ITIC’s centenary celebrations, a new initiative has been launched: a year-long internship in collaboration with the London Nautical School. This programme provides one student with the opportunity to gain hands-on experience across the shipping industry by working with ITIC.

The initiative aims to open doors for young talent. By connecting the intern with a variety of member companies, ITIC seeks to showcase the wide range of career opportunities available in maritime services. These include broking and agency as well as legal, insurance, and logistics. This effort marks a significant step towards developing a more knowledgeable and inspired next generation of shipping professionals.

The future: Evolving with the times

It will undoubtedly be interesting to see how technology, especially AI, shapes the future. Ultimately, shipping is a people industry, and we still believe that where humans are involved in the chain (even if their role changes), errors will still occur – and we will remain here to assist with them. Perhaps one day we will face a negotiation between two AI brokers that went wrong. Perhaps they will have uploaded different information regarding safe ports or the stats of the vessel or cargo.    

Mistakes still happen and debts still go unpaid. ITIC’s mission remains clear: to be a trusted partner for the next generation of transport professionals, delivering tailored support, practical expertise and the mutual strength that has defined the past century.