Marine Insurance Case Study

CHAPTER 1: INTRODUCTION

1.1 RESEARCH BACKGROUND

Marine insurance plays an important role in risk management service by providing individual protection against the risk of losses from the various perils. Besides, marine insurance is essential in the field of overseas and internal trade of a country. If there is no cover or protection by marine insurance the entire trade structure may bind to suffer. There are two types of marine insurance protection which are hull insurance and cargo insurance. Hull insurance covers the ships and the other machinery onboard ship. Meanwhile, cargo insurance provides insurance cover in respect of loss or damage to goods during transit by road, rail, air or sea. Hence, cargo insurance concerns about export and

The unpredictability in the shipping industry is driven by the freight rates, which is determined by the demand and supply in the shipping market. According to ( Elveness & Widiantoro, n.d.) factor that determines the price of shipping stock in the financial market is not always on freight rates. This trend becomes more appealing since the shipping industry has a claim about inefficiency in this market. The inefficiency here means that there is a possibility for some player to get the own benefit based on imperfectness of the shipping market information. Ghiorghe and Ana Maria (2010) also recommend that it is the fluctuation in the freight rates that create the risk in the shipping industry. In order to understand the fluctuations of the freight rates, one have to understand the economic mechanism. The freight rates are determined by the supply and

Building rapport with the respondent is usually easiest in this setting. The interviewer asks each respondent the same series of questions. The questions are created prior to the interview, and often have a limited set of response categories. There is generally little room for variation in responses and there are few open-ended questions included in the interview guide. Questioning is standardized and the ordering and phrasing of the questions are kept consistent from interview to interview. The researcher plays a neutral role and acts casual and friendly, but does not insert their opinion in the