Underwrite a health hazardous marine cargo with terrorism extension

How to underwrite a health hazardous marine cargo with terrorism extension? A topic that most underwriter will reject the insured especially after September 11. Is it difficult to underwrite such a cargo? A veteran who had conquered the Mount  Everest seeing no danger of in climbing it.

Receiving an email from Texas USA to cover a shipment of 1 full load of a container of aluminum oxide ex-warehouse to Pasir Gudang plant. Reading an email was a luxury for me at that time, nevertheless, I received a call at 5.30 pm.

USA Call

A lady called me, “Can I speak to Mr. Jamin Wong”

“Yes, I am speaking, how can I help you, lady?

“An Full container load of aluminum oxide tentatively to leave the factory premises at midnight, can you cover this shipment for us?

“Sure, no problem, but, I need a chemical analysis report of the cargo, also the packing method and material use.”

“OK, that is fine, just give me half an hour to furnish you all the necessary documents, if you have the doubt please call me and my aides, we work 24 hours.”


After 30 minutes, upon notifying the full chemical analysis report that the aluminum oxide used as a catalyst for the plastic manufacturing plant.

The inorganic compound filled in a double side steel metal drum to prevent any spillage on the ground. Thick carton paperboard gaping between the drums prevent the shifting movement in the container.

Health Hazard of Aluminum oxide

  • It can absorb into the body by inhalation of its aerosol.
  • The short term exposure can cause eye and upper respiratory tract irritation.
  • Aluminum oxide on the long-term exposure causing damage to the central nervous system.

Premium calculation

Any chance of hijacking and the consignment falls into the hand of the terrorists? The probability of risk calculation determines like the launching of a satellite using rocket.   Chances of an explosion of the rocket to derive the reasonable and acceptable premium?

Condition Attached

“I accept the risk but on condition with an addition a public liability coverage. Is it ok with you?” I called the lady counterpart in the USA.

“Why a public liability insurance attachment?” she asked me.

” Due to the health hazard associated with the biohazard cargo during an impact damage, the substance in the powder form will pose a danger to the public at large. Would you like your company being sued for billions of dollars? I advised her.

“OK. Do what is deemed necessary and not to forget to give us your insurer’s bank detail for payment of premium. Have a nice day and I look forward to receiving the policy via email.”

I underwrite the policy promptly with a restricted clause, covering both of policies with the sum insured totaling more than 2 million dollars.

“The consignment on land transit permitting only during the off-peak period avoiding any accident occurs.”

Inserting such clause prevent any unforeseen accident when the shipment destined at the Johor Baru causeway. Cars and truck bumper-to-bumper crawling along the causeway stranding thousands of people. A disastrous scene when a collision with the container, people valued their precious life either run or jump into the Johor Strait.

A few months later, we had lunch with the regional manager. The HQ marine underwriter informing us they turned down the regional manager’s proposal initially, subsequently, you had underwritten it finally. Indeed, a shocking discovery of that day! Having a vast decade of experience more than me in the industry but did not pursue the Chartered Insurance Institute marine paper. A loss prevention is always the best practice of insurance.

You like my article

Please share it out with your friend or family member. Sharing is joy doubles. Welcome any suggestion and comment or be a subscriber to my mailing list.

Email me at [email protected]


Underwrite a health hazardous marine cargo with terrorism extension 1

Underwrite a health hazardous marine cargo with terrorism extension 2Underwrite a health hazardous marine cargo with terrorism extension 3



20 replies to “Underwrite a health hazardous marine cargo with terrorism extension”

  1. Fascinating, i had never really thought of the human element behind insurance companies – the assessment and analysis of risk that goes on behind the scenes.

    1. Thanks for reading my article and giving me a valuable feedback.
      The public would never know how tough job for the underwriter/insurance broker to evaluate the risk and a derive affordable and fair premium for the insured in order to obtain a profitable business.

  2. Interesting story though I don’t really understand the whole story fully. Could you help me to break down part by part. You mentioned about aluminium oxide being toxic and you ended off by saying ”
    A loss prevention is always a best practice of insurance.”I am really lost. Could you enlighten me on this. Thank you.

    1. Thanks for reading my article and giving me a valuable feedback.
      Since aluminum oxide is a health hazard thus the packing is very important to prevent leaking or escaping into the atmosphere.It is always to evaluate the risk fully and precaution taken before accepting the risk. Just like the wet floor, it is wise to wear a boot to prevent slipperily fall.

    1. Thanks for reading my article and giving me a valuable feedback. Yes, risk management and prevention is the utmpost important for any insurer or broker.

  3. Hi Jamin,

    Although I have never underwritten insurance before, I have been in the lady’s shoes. Having to provide some of the information required did seem a little strange at the time, however after reading the about the process of underwriting here, it has made things a little clearer.

    Thanks for posting.

    1. Thanks for reading my article and giving me a valuable feedback. Filling the insurance proposal form is like building a trust relationship between the insured and the insurer.

    1. Thanks for reading my article and giving me a valuable feedback.
      yes, w need to take the preventive measure when dealing with chemical cargo.

  4. Hi Jamin – A very interesting post. Never knew that this type of assets are insured. But I guess that you have a point since it also endangers the lives of people if disasters strikes in.

    1. Thanks for reading my article and giving me valuable comments.
      It is better to give the detailed information to the reader rather than keeping to ourselves.

Leave a Reply

Your email address will not be published. Required fields are marked *