A payment per unit of deviation recorded in a weather index. For example, £2,500 per Heating Degree Day is the tick, meaning a payout based on £2,500 times the number of HDDs in excess of the strike. See WEATHER DERIVATIVES.

Option to use the proceeds of a pension plan to buy an annuity from the insurer concerned at its current market rate as an alternative to taking the guaranteed annuity option. See also OPEN MARKET OPTION.

a form of reinsurance that includes a timing risk, that is the risk that the reinsurer might become liable before sufficient funds had accumulated to meet the liability; an early form of financial reinsurance and arguably not insurance at all.

Discounting mechanism using an aggregate excess of loss cover. The reinsurer agrees to pay the cedant a fixed schedule of payments at future dates in return for an initial premium representing the net present value of the scheduled losses. The contracts are a form of financial reinsurance with little or no risk transfer. The principal uncertainty is date of settlement and this makes the arrangement attractive to long-tail insurers.

The charterer has the use of the vessel for a specified time. The shipowner supplies the crew and the provisions.

An excess or deductible expressed in terms of hours or days as opposed to a monetary amount. Under an engineering consequential loss policy it is customary to exclude the first 24 hours (or some other period) of any period of interruption following damage to or breakdown of plant or machinery.

Form of business interruption insurance that pays an amount for each day’s stoppage of the business. The system is used on occasions in some engineering consequential loss policies based on time lost following machinery breakdown.

UK: A policy that insures the subject-matter, normally a hull, for a stated period of time (Marine Insurance Act 1906, s.25(1)) as opposed to a specific voyage. Hull risks are usually insured in this way using the International Hull Clauses or the earlier Time Clauses.
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UK: a type of marine insurance in which a ship is insured for a specific period of time, rather than a specific voyage.
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Ocean marine Policy covering the insured’s interests in voyages which begin during the Policy period. A time Policy, appropriate for a shipper of many cargoes or the owner of several vessels, does not cover losses to voyages which were underway whey the Policy period began, but, as long as the voyage began during the Policy period, it covers losses in voyages which conclude after the Policy period ends.

1. Risk attaching to an insurer that losses become payable earlier than expected. This prevents the insurer from earning his anticipated investment income or requires the premature liquidation of assets or raising loans to satisfy the claims. Financial reinsurance methods are primarily concerned with allowing insurers to smooth out losses over time. 2. The risk that an investor buys or sells investments at the wrong time.

A noise in the ears that may accompany loss of hearing. Tinnitus may have a significant effect on the damages awarded in claims based on occupational deafness.