Product · Hull & Machinery
Hull and Machinery Insurance Built on Vessel-Level Risk
Cover for physical damage and machinery damage including collision, grounding, fire, explosion, heavy weather, salvage, actual total loss and constructive total loss.
What it covers
- ◆Hull and structural damage
- ◆Machinery breakdown and damage
- ◆Collision and contact liability (where included)
- ◆Grounding and stranding
- ◆Fire and explosion
- ◆Heavy weather damage
- ◆Salvage and salvage charges
- ◆Actual total loss (ATL) and constructive total loss (CTL)
Who it is for
- ◆Shipowners operating commercial fleets
- ◆Bareboat and demise charterers carrying insured-party risk
- ◆Banks and lessors requiring loss-payee cover
- ◆Brokers placing fleet hull programmes
Pricing
How Quantica prices it
Hull and machinery is priced on a frequency-severity model at the individual vessel level. Expected loss is built from observed and modelled claim frequency, severity by peril, and exposure adjusted for age, class, flag, trade and management.
Expenses, reinsurance cost, capital cost and profit margin are then layered on transparently to produce the technical premium.
Expected Loss = Claim Frequency × Claim Severity
Technical Premium =
Expected Loss
+ Expenses
+ Reinsurance Cost
+ Capital Cost
+ Profit Margin
Underwriting data required
- • Vessel particulars, age, class, flag
- • Trading pattern and ports of call
- • Management and ISM record
- • 5-year claims history
- • Survey and condition reports
- • Loss record by peril
Claims examples
- • Engine-room fire requiring drydock
- • Collision with quayside structure
- • Grounding in restricted waters
- • Heavy-weather damage to deck cargo securing
- • Total loss following uncontrolled fire
Risk controls
- • Vessel-level line limits
- • Mandatory survey for older tonnage
- • Class and PSC monitoring
- • Deductible scaling by peril
- • Sub-limits for machinery
Reinsurance
Reinsurance considerations
Hull programmes are typically protected by quota share and excess-of-loss treaties. Quantica's engine sizes gross and net retention per risk, monitors annual aggregate erosion and supports facultative reinsurance for large or non-standard tonnage.
This product description is illustrative. Cover, exclusions and policy terms depend on the final wording and applicable regulatory authorisations. No insurance is offered until appropriate authorisations are in place.