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Insurance Glossary

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C&F
A sale contract under which the seller has the responsibility of placing the cargo on board and also incurs the ocean freight and obtain the bill of lading. It is for the buyer to arrange for an insurance cover for the voyage and until the cargo reaches the destination.

C.I.F.
A sale contract under which the seller is obliged to place the cargo on board the ship, pay the ocean freight and arrange insurance cover for the cargo during the voyage and until the cargo reaches the destination. He should arrange the insurance cover upon terms current in the trade, which will be for the benefit of the buyer. Seller should then arrange immediate delivery of all relevant documents including the Insurance Policy for the requirements and benefit of the buyer.

C.I.P.
Consignments in a completely knocked down condition, which are assembled at destination to be made into whole units.

C.K.D.
Consignments in a completely knocked down condition which are assembled at destination to be made into whole units.

Caking
Commodities like Sugar, Flour or Cement tend to get caked because of water absorption from the air. Marine Cargo Insurance Policies for such cargo, providing even widest coverage normally exclude caking risk, unless caused by a direct contact with water.

Calendar Year Experience
Business results during a calendar year analysed and experience studied on a calendar year basis.

Call Option/ Put Option
These terms are used to refer to the right of the investor or borrower to terminate the borrowing programme. For instance, in the case of a 7 year Debenture with Call and Put Option at the end of 3 years, the borrower has an option to repay the money raised by the Debentures or the lender has an option to call for the redemption at the end of 3 years, instead of waiting for 7 years. When the option is exercised by the borrower it is called Call Option and when the Option is exercised by the lender it is called as Put Option. The instruments can be designed to have either Call Option only or Put Option only or both options.

Cancellation
The discontinuance of an insurance policy before its normal expiry date stipulated in the policy

Cancellation Clause
The clause appears in most of the period policies. This gives the privilege to both the insurer and the insured to cancel the policy if they dont want the same to continue until the normal date of expiry. The conditions of cancellation differ among different policies. The exact provision in respect of a particular policy will be found incorporated in the policy.

Cancellation of Insurance-Motor
A policy can be cancelled only after ensuring that the vehicle is insured elsewhere and the original Certificate of Insurance of the policy that is cancelled is surrendered. Insurer should inform the Regional Transport Authority by registered A.D. about the cancellation of the insurance.

Cancellation of Treaty
A clause in the treaty reinsurance wording which outlines the procedure for termination of the obligations under the treaty by both the cedent and the reinsurer.

Cancellation Returns Only
Refund by the Marine Hull Insurers of pro-rata monthly premium for each uncommenced month of the policy when the policy is cancelled before the normal expiry date by mutual agreement between the insured and the insurer.

Cap a Well
The term used to control a blowout by placing a very strong valve on the wellhead

Capacity
(1) The amount of capital available to an insurance company for underwriting general insurance coverage or coverage for specific perils.

(2) The amount of insurance a company is able to write, due to limitations on or availability of capital.

Capacity of the parties to contract
This represents the shareholders contribution towards the capital of the company

Capital- Authorized
Insurance Policy providing cover against loss of or damage to accompanied personal baggage of the insured or insured's family member(s)due to fire, theft or any accident during the course of journey including stoppage enroute, anywhere in India. The policy normally excludes routine travels like going to and returning from office, theft from unattended vehicle, articles worn on the body of the person, war etc. It is possible that the policy is modified to suit the exact needs of the proposer subject to mutual consent and the insurer following the procedure of "file and use" laid down by the Regulatory Authority.

Capital- Paid up
This represents the maximum amount upto which the company can raise capital by way of issue of various types of shares. This amount is fixed while incorporating the company and can be changed by following the procedure prescribed in the companies Act.

Capital, Share
Out of the authorized capital the company may choose to issue shares only to some extent. The portion for which shares are issued and allotted is called the Issued Capital. Out of the issued capital also the company may collect the entire amount of the shares in one or two stages which are called calls. So the amount, which the shareholders have been called to pay is called the Called up capital. Out of the called up amount also some shareholders might not have paid the amount due and hence the amount, which is actually paid by the shareholders is called the Paid up capital of the company. In normal parlance the capital of a company will refer to the paid up capital only.

Capital Sum Insured
The term used in personal Accident Insurance policies to denote the sum payable under the policy for death or Loss of Two Limbs or Two eyes or for other Permanent Total disablement. Insurer normally tends to limit this sum with regard to individual persons based on the earning capacity of such persons in order that the persons do not over insure for their advantage.

Captain's protest
When the ship encounters heavy weather or any other accident or that the cargo suffers some accidental damages Captain of the Ship signs a declaration giving details of the accident and damage. This he does mainly to avoid any claim that may be lodged at a later date against the Ship management for negligence. This declaration is called Captains Protest. This document is requisitioned by the insurer in case of a claim for heavy weather damage to the insured cargo.

Captive Insurance Company
A company formed solely to insure the risks of its own parent company and all units coming within the group, with the primary objective of

a) providing the specific insurance covers for the group

b) achieving reduction in cost and also save on the tax angle

c) securing best of terms from the international market and

d) directly obtaining investment return on its invested capital.

Carboy
Glass containers protected by basket work for liquid cargo shipments, particularly acids.

Cargo Insurance
Plan depicting space in a ship occupied by cargo.

Cargo Plan
In relation to Insurance, guarantee executed by a bank in favour of an insurer, guaranteeing payment of premium by the insured in relation to certain policy/policies, within the period stipulated in the guarantee. In India as per the provisions of the Insurance Act and the Rules thereunder Premium shall be physically paid to the insurer in almost all cases on or before the commencement of cover. The Act and the Rules provide that only in cases where the premium is not ascertainable at the time of commencement of cover a bank guarantee shall be accepted by the insurer.

Cargo Thefts (Maritime Frauds)
One of the major causes of maritime frauds. These are caused by the owners of the ships who are paper companies, deviating the route, after taking the cargo on board and discharging them into a Port of Convenience, by using falsely registered vessels. Thefts are also caused by the collusion between the shipper and the consignee by tampering of the cargo either on board the vessel or at the terminal point at destination port and stealing the cargo and later putting a claim on consignee's insurer.

Carriage by Air Act, 1972 – Claim on Air Carrier
As per Section 26 of the Act, in case of loss or damage to luggage complaint should be lodged with the carrier within three days of discovery of such loss/damage and in case of goods the period for reporting is within seven days. Failure on the part of the owner or the person entitled to delivery shall result in no action lying against the carrier.

Carriage by Air Act, 1972– Defence of Carrier
As per Section 20 of the Act, the carrier is not liable if he proves that he and his agents have taken all necessary measures to avoid the damage or that it was impossible for himor them to take such measures. The carrier is also not liable if he proves that the damage was occasioned by negligent pilotage or negligence in the handling of aircraft.

Carriage by Air Act, 1972– Liability of Air carrier
As per Section 18 of the Act, the Carrier is liable for damage sustained in the event of the destruction or loss of, or damage to, any registred luggage or any goods, if the occurrence which caused the damage so sustained took place during the carriage by air. The term carriage includes the period during which the luggage or goods are in charge of the carrier, whether in an aerodrome or on board an aircraft.

Carriage by Air Act, 1972– Limitation of Liability
As per Section 22 of the Act, for registered luggage and goods the liability of the carrier is limited to 250 francs per kilogramme unless the actual value of the goods were declared to the carrier by the goods owner when the goods were handed over for carriage.

Carriage by Air Act, 1972– Time Limit for Suit
As per Section 29 of the Act, the right of recovery for loss or damage shall be extinguished if an action against the carrier is not brought within two years reckoned from the date of arrival of the aircraft at destination or the date on which it ought to have arrived.

Carriage by Air Act, 1972
This act gives effect to the provisions of the Warsaw Convention, 1929 and the Hague protocol, 1955 relating to international carriage of passengers and goods by Air. The act defines the liability of the Air Carriers for death or injury to passengers and for loss of or damage to registered luggage and cargo. It also mentions the time limits within which claim notice is to be served and suit to be filed against the Air Carrier.

Carrier
Shipowner, Airlines, Railways, Road Carriers or any other person or organisation who carry goods for transport.

Carrier's Act, 1865– Notice of Loss
As per Section 10 of the Act no suit shall be instituted against a common carrier of the loss/damage to goods, unless notice in writing has been given within six months from when the loss/damage first came to the knowledge of the goods owner or his agent

Carriers' Legal Liability Insurance
Policy intended to cover the legal liability of the Transport Carrier for loss or damage to goods entrusted to him for transport from one place to another. As the title of the policy implies, it does not cover any contractual liability assumed by the carrier. Insurer's, for underwriting considerations, tend to limit the coverage only in respect of loss or damage to goods arising out of a fire or any other accident to the carrying vehicle and also insist that the carrying vehicle should also be covered comprehensively under motor insurance
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