WO2002017032A2

WO2002017032A2 - Cargo insurance management system

Info

Publication number: WO2002017032A2
Application number: PCT/CA2001/001164
Authority: WO
Inventors: Mitchell Wasserman
Original assignee: Oceanwide.Com, Inc.
Priority date: 2000-08-18
Filing date: 2001-08-17
Publication date: 2002-02-28
Also published as: AU8739501A

Abstract

Disclosed is an Internet-based system that permits insurance underwriters, brokers, policyholders and their agents to access a central database for the purposes of issuing, managing and using marine & cargo insurance policies. Using a standard Internet browser, users are orchestrated through the required workflow processes to perform their tasks. Collaboration tools issue electronic alerts onto web-based status screens and by e-mail to prompt for action and streamline the processes involved in creating, issuing and renewing policies based on user requirements, generating certificates of insurance, recording shipment and storage declarations, initiating and processing claims, and tracking the use of the policies.

Description

CARGO INSURANCE MANAGEMENT SYSTEM

FIELD OF THE INVENTION

The present invention relates to the issuance, management and use of cargo insurance policies by insurance underwriters; brokers, policyholders and their agents. More specifically, it also relates to a computerized networked system for the issuance, management and use of cargo insurance policies.

BACKGROUND OF THE INVENTION The insurance of goods in transit and in storage at third-party warehouses is a required service for all companies that are responsible for or take ownership of goods as they move around the globe, from manufacturers to distributors to warehouses to customers or between different locations of the same company. Due to the varied levels of risk associated with the shipment of different types of merchandise, the involvement of the governments of different countries, and the use of different warehouses and conveyances, the evaluation and issuance of cargo policies and the binding of coverage for individual shipments has traditionally involved painstaking analysis of policyholder requirements and historical risks, complicated premium rate calculations and detailed reporting and recording of shipment details.

Typically, a shipper or transportation intermediary meets with a broker and describes the nature of his business, the types of cargo he wishes to insure, the geographical origins and destinations usually involved and the modes of transportation used. The broker then works with one or more underwriters to determine premium rates and insuring conditions for each commodity and transportation mode, the increased risk premiums and/or special conditions related to specific countries and/or vessels, and the limits of coverage which normally specify maximum values for individual shipments, voyages, and warehouses. The differing options having been explained to the shipper by his broker, a selection is made and a policy is issued by the underwriter complete with all required conditions, endorsements and restrictions, a detailed list of approved insurable items, and a rate calculation table.

On a periodic basis, policyholders are instructed to record the details of their shipments and stored cargos, and submit them to the broker who calculates and extends the premiums and issues an invoice. The policyholder then reviews the calculations and remits payment to the broker who in turn remits payment to the underwriter, and collects his commission. Diligent underwriters also enter the shipment data into internal computer systems for validation against reported claims and to reassess the risks and analyze the actuarial correctness of the premium rates billed on an ongoing basis.

In cases where policyholders ship a diverse and changing list of commodities, as in the case of trading companies and transportation intermediaries servicing multiple shippers, questions invariably arise as to whether a specific cargo is covered under the policy, which rate should be used to calculate the premium, and which conditions and restrictions apply to the shipment. These questions necessitate telephone conversations between the clerks in the policyholder's office, the broker, and often the underwriter as well. In many cases, policyholders simply assume that their cargos are properly insured when in fact, their policy either does not cover them or offers inadequate coverage. In the event of a claim, underwriters are often faced with the choice of paying the claim although it is outside the coverage offered by the policy or refusing to pay and losing a client.

The administrative and underwriting work involved in issuing and managing cargo policies drives premium rates up and imposes a significant administrative burden upon policyholders. Moreover, as the premium calculations are complex and performed manually, they are subject to error. Shippers with multiple decentralized offices are faced with the difficulty of tracking consolidated exposure at individual warehouses and on individual vessels. Finally, the process itself is subject to fraud as shipment data is often only reported days or weeks after the cargo has arrived at its destination without incident.

Shippers also frequently require certificates evidencing insurance coverage for shipments. In the arena of international trade, letter of credit payment instruments are often used, where financial institutions act as intermediaries and release payment upon presentation of shipment and insurance documents. These insurance certificates are prepared by the broker or underwriter using a typewriter and onion-skin pre-printed forms. In high- volume situations, the policyholders are given pre-signed forms and prepare the certificates themselves. This uncontrollable manual process gives rise to additional risks of error and fraud.

Another important aspect of managing a cargo insurance policy is the handling of claims. Claims can be initiated by the policyholder, by the assured party related to a specific shipment, or by an agent of either party. Given the nature of international trade and the scope of coverage offered by cargo policies, insurance companies establish networks of claims agents to handle claim in each country in which they conduct business. These agents examine, document and assess the veracity of the claim, and must communicate this information to the central claims handling office of the insurance company. This process often involves appraisers to determine the amount of damage. Furthermore recovery agents and lawyers are engaged in attempts to subrogate these claims, investigate suspected fraud and properly dispose of damaged property. Insurance companies build paper files manually to track claims and must revisit these files regularly to update claimants on the progress of a claim.

Several attempts have been initiated to alleviate the administrative burden associated with cargo insurance. Computer software programs have been created that allow shippers to streamline the preparation of certificates, offering the ability to correct mistypes in a word processor-like manner and to insert commonly used clauses using pick lists. These programs, however, do not enforce compliance with a shipper's policy restrictions, nor do they calculate the applicable premium.

A recent trend has been for underwriters to calculate total premium on an annual basis based on such aggregated figures as total revenues or total claims, and to eliminate the recording and reporting of individual shipment information. While this certainly eliminates the administrative burden, it also precludes any analysis of risk by commodity, country, port airport, transport mode or carrier, and does not enforce policy restrictions and monitor adherence to policy limits. An Internet-based system for Cargo Insurance was published for use by a select group of freight forwarders and transportation intermediaries by the creators of the current invention. The prior art system, known as CargoCover, was designed and programmed with a single policy offering broad coverage that could accommodate the requirements of small freight forwarders. It allowed different companies to request access to this policy through an Internet-based registration form. The broker that administrated the policy could then approve or deny authorization to the requester, offering a single discount rate against the general policy premium rates. Authorized users could then use the system to enter shipment data and produce insurance certificates evidencing the coverage. The system calculated the premium due for the shipment and allowed the user to accept or reject coverage based on the rate quoted. The system also offered rudimentary validation to prevent the issuance of certificates involving restricted countries or dangerous goods without underwriter authorization.

The system did not provide for the recording of multiple policies, multiple underwriters, multiple brokers, varied insurable interests tailored to each user, multiple currencies, different insuring conditions, deductibles and limits for different insurable interests and conveyances. It had no claims management or risk management analysis capability whatsoever. All applications from prospective users necessitated a manual intervention by the broker and/or underwriter administrating the system to allow access. The coverage offered and functionality was, therefore, significantly limited and its applicability was significantly limited. Furthermore, it provided severely limited ability to monitor and control access preventing its adoption for widespread use.

SUMMARY OF THE INVENTION

Therefore, it is an object of the present invention to provide a computerized system which avoids the aforementioned disadvantages of prior art systems and which allows underwriters, brokers and policyholders to collaborate towards the management of cargo insurance policies.

An important object of the invention is to simplify the recording of shipment data and the production of insurance certificates by policyholders, while automating the calculation of premiums, enforcing compliance with the underlying policy, and eliminating all redundant data entry.

Another object of the invention is to allow underwriters to easily capture shipper information and to automate the rating and issuance of cargo policies.

A further object of the invention is to allow policyholders, insurance companies and their claims settling agents, lawyers and recovery agents to collaborate towards the reporting and processing of claims. According to a first aspect of the present invention, there is provided a system and method for issuing insurance under a policy. A user profile is created using the user profile editor. An insurance request is also created using the insurance request editor and is received by the Applicability Definer. The Applicability Definer compares the insurance request with the conditions for insurance set forth in the user profile. The Applicability Definer determines if the insurance request falls within the pre-approved conditions of insurance for the user defined in the user profile. If the insurance request falls within the conditions, a premium rate is calculated by the premium rate generator, the terms for the premium rate are determined by the premium rate terms generator, the insurance is binded to the insurance request and the proof of coverage is issued by the proof of coverage generator.

Alternatively and preferably, if the insurance request does not fall within the conditions for insurance, a review request is sent by a review request generator to a broker or an underwriter. The broker or the underwriter then takes a review decision on the insurance request to either approve coverage, determine a revised premium rate, determine revised conditions of insurance or deny coverage. A review decision is then sent to the Applicability Definer by the review decision generator which, if the coverage is approved, again calculates the premium rate, determines the terms for the premium rate, binds the insurance and issues the proof of coverage.

According to another aspect of the present invention, there is provided a method and system for issuing a cargo insurance policy. A generic cargo insurance policy is created and comprises at least one basic rate for insurance coverage and is stored in a generic policy file. At least one rule is built for applying a discount and/or a premium to the basic rate using potential characteristics of shipments. The potential characteristics comprise potential types of commodities shipped, potential origin and destination countries for shipments, potential volumes of the shipments, potential number of years at least one of a potential shipper and a potential transportation intermediary has been in existence, potential information concerning claims made and potential credit reference information. The rules are stored in a rate calculation table. A set of limit values is built for the potential characteristics. A shipper or a transportation intermediary enters registration data comprising identification information, types of commodities shipped, origin and destination countries for shipments, volumes of the shipments, number of years the at least one of a shipper and a transportation intermediary has been in existence, information concerning claims made and credit reference information and stores the registration data in a registration data file. The registration data file is retrieved together with the generic policy file and, when the registration data falls within the set of limit values for the potential characteristics, the generic cargo insurance policy is customized using the registration data and the rate calculation table to a customized policy for the shipper. According to still another aspect of the present invention, there is provided a method and system for determining a premium rate for an insurance request under a cargo insurance policy. A basic rate is specified for each available characteristics for a shipment under a policy. An additional risk and war premium rate is then specified for each country under the policy. An overage vessel premium rate table is specified for the policy. An insurable interest, a conveyance type, an origin, a port of loading, a destination and a port of discharge are selected from a list of available characteristics for a shipment under the policy. An overall premium rate for the shipment is calculated using the basic premium, the additional premium for risk and war and the additional premium for overage vessel.

According to a further aspect of the present invention, there is provided a method of determining at least one rule for calculating at least one of a premium and a discount to a basic insurance rate. The method comprises the steps of storing data concerning insurance claims filed with an insurance issuer. The data at least comprise a shipment origin, a shipment destination, a commodity shipped, an insurance policy and a time period for the claims. A risk factor is identified and determined. The risk factor is associated with each of the shipment origin, shipment destination, commodity shipped, insurance policy and time period. A rule is determined and is applied to the basic insurance rate to calculate one of a premium and a discount using the risk factor .

As will be readily understood from the detailed description, different elements of the system according to a preferred embodiment can be located in different countries and different steps can be carried out in different countries. This implies that the user might be located in a country where he only specifies information concerning himself or shipments. He can then send this information to the cargo insurance management system server which will process the information using databases that can be located somewhere else in the world and will send the processed information either to another user in another country or back to the first user. It will be understood that the information contained in the signal sent and received which have been processed according to portions of the preferred embodiments described fall within the scope of the present invention.

BRIEF DESCRIPTION OF THE DRAWINGS

These and other features, aspects and advantages of the present invention will become better understood with regard to the following description and accompanying drawings, wherein:

Figure 1 is a block diagram of the system architecture according to a preferred embodiment of the present invention;

Figure 2 is a log-on screen;

Figure 3 is a session tracking table;

Figure 4 is a status screen;

Figure 5 is a list of menu options; Figure 6 is a user profile screen;

Figure 7 is the shipment query screen;

Figure 8 is the detailed shipment information screen;

Figure 9 is the storage declaration query screen;

Figure 10 is the storage information screen; Figures 11 A and 11 B are the policy maintenance screens;

Figure 12 is the specific values for selected conveyance screen;

Figures 13A and 13B are the insured interest maintenance screens;

Figure 14 is the country restriction maintenance screen;

Figure 15 is the vessel overage premium table screen; Figure 16 is a special rate maintenance screen;

Figures 17 and 18 are special rate changes to the policy viewing screens;

Figure 19 is the assured query screen;

Figure 20 is the insured information screen;

Figure 21 is the alternate user information screen; Figure 22 is the claims query screen; Figure 23 is the claimed information screen; Figure 24 is the summary of account receivable screen; Figure 25 is the detailed account receivable screen; Figure 26 is an invoice screen; Figure 27 is an analysis report screen; Figure 28 is a performance analysis screen; Figure 29 is an administration menu screen; Figure 30 is a user maintenance form screen; Figure 31 is a user access statistic screen; Figure 32 is general information editor screen; Figure 33 is a commodity maintenance form screen; Figures 34A and 34B are commodity report class maintenance form screens; Figures 35A, 35B and 35C are coverage premium group search and maintenance screens;

Figures 36A and 36B are underwriter maintenance form screens; Figures 37A and 37B are agent group maintenance forms screen; Figures 38A and 38B are agent maintenance form screens; Figures 39A, 39B and 39C are currency maintenance form screens; Figures 40A, 40B and 40C are region maintenance form screens; Figures 41 A, 41 B and 41 C are country maintenance form screens; Figures 42A, 42B and 42C are state/province maintenance form screens; Figures 43A, 43B and 43C are port maintenance form screens; Figures 44A, 44B and 44C are airport maintenance form screens; Figures 45A, 45B and 45C are template maintenance form screens; Figure 46 is a claims letter form screen;

Figure 47 is a shipper or transportation intermediary homepage screen; Figures 48A, 48B are registration page screens; Figures 49A and 49B are confirmation of marine insurance screens; Figure 50 is a cargo information screen;

Figures 51 A and 51 B are a certificate of insurance completion form screens; Figure 52 is a confirmation screen for the certificate of insurance, Figure 53 is a sample certificate of insurance; Figure 54 is a storage declaration screen; Figure 55 is a record storage declaration screen;

Figure 56 is a claim initiation screen;

Figure 57 is a search screen to locate certificates;

Figure 58 is a listing of prior bookings found using the search feature of FIG. 57; Figure 59 is a screen showing the located booking using the search feature of

FIG. 57;

Figure 60 is a search screen to locate declarations;

Figure 61 is listing of open policy declarations found using the search feature of

FIG. 60; Figure 62 is a declaration creation screen;

Figure 63 is a policy information and supporting documents locator;

Figure 64 is a block diagram of the system according to a preferred embodiment of the present invention;

Figure 65 is a flow chart of a method of issuing a proof of coverage for a shipment according to a preferred embodiment of the present invention;

Figure 66 is a flow chart of a method of issuing a cargo insurance policy according to a preferred embodiment of the present invention;

Figure 67 is a flow chart of a method of calculating a premium rate for a shipment according to a preferred embodiment of the present invention; and Figure 68 is a flow chart of a method of determining rules to calculate premium rates using risk factors associated with claims filed according to a preferred embodiment of the present invention.

DESCRIPTION OF THE PREFERRED EMBODIMENT OF THE INVENTION The present invention uses a communication network such as the

Internet to facilitate the use of the system by users that are geographically dispersed and have computers that are incompatible with each other. The invention utilizes a central database that is accessed by all users through a server using industry standard protocols and browsers. Users can access the system, query the database, and record information using simple forms, such as Internet-based HyperText Markup Language (HTML) forms. Alternatively, they can communicate with the system without a browser by submitting extensible Markup Language (XML) files to the server using Secure HyperText Transport Protocol (HTTPS). The system allows shippers and transportation intermediaries to initiate the request for a policy by describing their business requirements. Preferably, underwriters and brokers can establish rules-based premium rate and policy restriction guidelines using the information entered by shippers to automate the creation and issuance of cargo policies, or alternatively review the information recorded by prospective policyholders manually on screen and create a customized policy using tools to select appropriate clauses, set rates and limits for each allowed commodity, transport mode and country.

The underwriters and brokers also preferably specify which individuals will be responsible for managing the insurance for the insured (the "insurance managers") and what their individual rights will be under the system.

The insured parties preferably use the system to record information regarding cargo shipments that are made under their policy and the system calculates the appropriate premium, binds the coverage and issues an insurance certificate to provide evidence of that insurance. The system also preferably allows insured parties to request coverage for shipments that are outside the limitations of their policy and these requests trigger notification alerts that are sent (i.e. by e-mail) and/or appear on the status screens of the insurance managers for the policy. The insurance managers can then set new conditions of insurance and/or premiums and bind the coverage, which in turn issues an e-mail notification to the insured.

Based on policy requirements, invoicing is also preferably performed by the system. E-mail invoice notifications are sent automatically and users can request details of an invoice to examine the specific shipments and related premiums that make up the total. Payment can be effected through the system using credit card or electronic funds transfer, and the system offers a complete accounts receivable management system for brokers and underwriters.

The system also preferably provides for the initiation, recording and tracking of information regarding claims made pursuant to the policies issued. Follow-up dates trigger notification (i.e. by e-mail) messages and status screen alerts to improve claims handling and improve the communications between the claims managers, brokers, assured parties, settling agents, recovery agents and lawyers working on the claim.

The system also preferably implements several reporting and analysis tools assisting underwriters in identifying and highlighting aggregate risks and claim ratios across several policies and adjusting premium rates and policy conditions or seeking reinsurance accordingly. These tools also assist policyholders in managing their risk and reducing their administrative costs and paperwork generation.

Access control and security for the system is preferably managed using authentication scheme and multi-level security profile that is used to determine the specific policy information that each user can view or change, the presentation of the policy information, as well as all other functions the user is permitted to perform on the system.

A representative system in which the present invention is implemented is illustrated in FIG. 1. Several client machines operated by shippers, transportation intermediaries, insurance brokers, insurance underwriters, claims settling agents, recovery agents, and lawyers are connected to a communication network such as the Internet. Content server machines are accessible to the client machines through the communications network.

A typical client machine is a personal computer, notebook computer, Internet appliance or pervasive computing device (e.g. a PDA or palm computer). The client includes an operating system, such as Microsoft Windows, and a suite of known Internet tools including a Web browser, such as Netscape Navigator or Microsoft Internet Explorer, and preferably, an e-mail client, to access the servers of the network and thus obtain certain services. These services include one-to-one messaging (e-mail), one-to-many messaging (bulletin board), on-line chat, file transfer and the browsing of HTML pages. A typical server is a Compaq Proliant server comprising one or more

Intel-based processors, a server operating system such as Microsoft Windows NT, and a web server program such as Microsoft Internet Information Server. The present invention is preferably implemented as a collection of HTML files and computer programs operating on a web server, or a web site. Although the invention will be described in the context of a single web server, it is common practice for several web servers to be linked together so as to provide services to many clients simultaneously and the described functionality may be implemented across multiple servers, even if they are physically separate from each other and connected only through the Internet. The computer programs running on the web server contain routines for the generation of HTML display screens and input forms that together comprise the user interface for the system. The computer programs are also able to accept the submission of XML files containing data submitted directly from another computer program without any user data input. Upon the receipt of an XML input file, a response XML file is returned via the Internet to the computer program that initiated the transaction.

FIG. 2 shows the log-in used screen for underwriters, brokers or their agents. Entering a user ID and a password, allow a user to be authenticated and identified his/her permissions and privileges in the system. In order for the system to retain the identity of the user as he/she performs various functions and travels from screen to screen throughout the system, a session-tracking table (see Fig. 3) that stores the user's current identity and state is used. There are several different types of session tracking mechanisms that have been created for similar purposes and for use with Internet related systems. Many can be used with this invention.

Once a user has logged on to the system, he/she is presented with the Status Screen, illustrated as FIG. 4 and a list of menu options represented by hypertext links (see FIG. 5). Using the user's preferences as specified in the User Profile Screen (see FIG. 6), the Status Screen displays summary shipment information (a), unacknowledged claims (b), claims follow-up (c), inactive policies (d), referred shipments (e), change and cancellation requests (f), and follow-up items (g), all for the list of policies that the user is allowed access to. The system is designed so that the Status Screen prompts the user to take action on all items that he/she is responsible for. The summary shipment information provides a quick update as to the activity on the system by the user's policyholders. The unacknowledged claims section prompts the user to examine the claim by clicking its hyperlink and to send an acknowledgement e- mail to the policyholder and claimant. The outstanding referrals section alerts the user as to the existence of claims that meet his/her criteria for examination and that there are items that require action with respect to an individual claim. The inactive policies section alerts the user when policies are not used to book shipments in accordance with the report period specified in the policy. This prompts the user to contact the policyholder to remind him to report his shipments. The referred shipments section alerts the user when attempts were made to book shipments and were blocked by the system. This situation could occur for a number of reasons identified below and requires the user to examine the shipment, determine whether it can be booked, and confirm or reject the coverage which in turn sends an alert e-mail to the Assured that initiated the attempt to book coverage. In certain cases, a broker or underwriter must confirm any change to or cancellation of a booked shipment or storage declaration. In these cases, policyholders request the changes or cancellations and these requests appear in the change and cancellation request section of the Status Screen. Users are then alerted to examine the request and effect the change or cancellation by hyperlinking to the specific shipment or storage declaration. Upon confirmation or rejection of the request, an e-mail message is transmitted back to the user who initiated the request. The follow-ups section of the Status Screen contains specific follow-up reminders attached to policies accessible to the user. This section also contains new registrants requesting coverage if specified in the user's profile. Each follow-up item alerts the user to perform some action and the hyperlink leads the user through the workflow.

The access to specific policies for different users is preferably specified using access control lists, a widely used security configuration procedure, but may be specified directly as well by the system administrator. Within the User Profile Screen, users may indicate for each of the Status Screen sections listed above, whether the section should be displayed on the Status Screen (as in FIG. 4), should not be displayed, or should appear as a single line linking to the complete section. The User Profile also allows users to change their name, password and e-mail address, the currency in which to display all consolidated amounts, and the minimum value and age for claims to appear on their Status Screen.

Users can access individual shipment information by hyperlinking directly from a link on an individual shipment listed in the referral or change request sections of the Status Screen or by querying the database using the Shipment Query Screen (FIG. 7). The Shipment Query Screen generates summary or detailed lists of shipments booked under policies issued through the system and allows the user to hyperlink to the detailed Shipment Information Screen (FIG. 8). If the user has been given the right to change information by the system administrator, the Shipment Information Screen allows the user to change any information about an individual shipment including the conditions of insurance, the premium, insured value, etc. all as illustrated in FIG. 8. All changes to shipment information are logged by the system and listed at the bottom of the Shipment Information Screen.

In a similar fashion, users can access storage declaration information by hyperlinking directly from a link on an individual storage declaration listed in the referral or change request sections of the Status Screen or by querying the database using the Storage Query Screen (FIG. 9). The Storage Query Screen generates summary or detailed lists of storage declarations booked under policies issued through the system and allows the user to hyperlink to the detailed Storage Information Screen (FIG. 10). If the user has been given the right to change information by the system administrator, the Storage Information Screen allows the user to change any information about an individual storage declaration. All changes to storage declarations are logged by the system and listed at the bottom of the Storage Information Screen.

Policies are created in the system using the Underwriting Screens (FIGs. 11-18). New policies can be created from scratch or by starting with a copy of an existing policy. Policies include general information on the policyholder (FIG. 11A-a), information as to which conveyances are authorized for use with the policy and the conditions and value limits ascribed to each conveyance (FIG. 12), standard insuring and valuation conditions, indication of authorization (or lack thereof) for open policy declarations and bulk reporting, and the use of a vessel overage premium table (FIG. 15), lists of named storage locations, their limits and the limits for unnamed storage locations (FIG. 11B-e), premium rates, conditions and conveyance authorization for each commodity covered by the policy (FIG. 13), restrictions, conditions and risk or war premiums for specific countries (FIG. 14), billing information including the frequency of invoicing, the type of invoicing (flat rate or based on actual premium booked), terms of payment and the credit limit for the policy (FIG. 11 B-g), and the various documents made available to policyholders including the policy itself, a policy summary and other procedures (Figs. 11 B-i and 11B-j). The Underwriting Screens also allow an unlimited number of follow-up items and inactivity alert to be attached to a policy so as to trigger an alert on the Status Screen, as described above. It is also possible to attach special rates for specific commodities, conveyances, and shipment routes (FIG. 16). All changes to Underwriting Screens for a specific policy are logged and available for view on screen (FIG. 17 and FIG. 18). The preferable implementation of the Underwriting Screens utilizes picklists to reduce the rekeying of information such as underwriting clauses and to standardize for aggregation and analytical purposes. The information entered into the Underwriting Screens is used to validate each shipment entered by policyholders as will be described below.

Attached to each Policy are one or more Assured parties. The information regarding each Assured is entered into an Assured Information Screen, illustrated in FIG. 20. The system stores general identification information (name, address, phone, etc.) about an Assured, the e-mail address and password that will be used by the Assured to log on to the system, an alternative e-mail address for the electronic transmission of invoices, the broker, contact and policy access authorization, as well as an indication whether the created Assured data is simply for demonstration purposes and should not be used to actually bind coverage. Attached to each Assured are one or more Alternate Users. Alternate User information is entered into an Alternate User Information Screen (FIG. 21) and provides authorization for other users to access the system with a similar profile to the Assured. Access to the Assured Information Screen for a specific Assured party is accomplished by either hyperlinking from the Status Screen - Follow-up or Referral sections or by using the Assured Query Screen (FIG. 19).

Information on Claims is accessible using the Claims Query Screen (FIG. 22). The lists generated from this query allow users to locate and hyperlink to a specific claim which can be viewed and maintained in the Claim Information Screen (FIG. 23). The Claim Information Screen contains information on the claimant, the amount claimed, the location of the cargo, the lawyer, settling agent and recovery agent assigned to the claim, the type and amount of all payments made or recovered with respect to the claim and the status of the claim (open, under review, in recovery, closed). The Claim Information Screen also allows users to upload and attach any electronic file to the claim which is then available for access and downloading by any other user with access to the claim. The Claim Information Screen for an individual claims may also be viewed by hyperlinking directly from the Status Screen - Claims sections.

The system issues invoices by e-mail automatically based on the information entered in the Underwriting Screens, as described above. A detailed accounts receivable is also maintained by the system and payments can be entered and applied against specific invoices, individual shipments or left on account. A series of drill-down Receivable Screens (FIGs. 24-26) allow users to list overdue receivables, view the invoices underlying the receivable balances, and hyperlink to the actual shipments billed in each invoice. Credit card and electronic funds transfer payments may be made through the system by policyholders, automatically reducing the receivable balance.

A number of analytical tools are available in the system to allow users to identify risks in excess of specified limits for individual vessels or storage locations. These tools (FIGs. 27-28) also allow the user to view the recorded information by pivoting on a number of independent analytical dimensions including the shipment origin, destination, commodity, policy, and time period.

By analyzing the claims ratios from data aggregated across many policies in multiple dimensions, users can better determine what the real risks are for different commodities and countries and rate individual policies more accurately.

There are a number of important tables used by the system including ports, airports, countries, commodity groups, etc. The system also offers screens for the maintenance of these tables by the system administrator (FIGs. 29-46). The system administrator also must specify the rules related to new registrants requesting policies and the users who will be responsible for responding to those requests, all as described below. The screens and functionality described above are normally made available to underwriters and brokers for the purposes of setting up policies, administrating the use of these policies, managing claims made under these policies and analyzing the data recorded under these policies. Policyholders and prospective policyholders access the system using a different Internet Address (URL) or web site.

FIG. 47 is a typical first screen or home page that is presented to a shipper or transportation intermediary when they first access the web site. It provides information about the use and functionality of the system, presents the user with entry fields for a user ID (typically their e-mail address) and password, offers a link for users who have forgotten their password so that they might ask the system to send it to them via e-mail, and offers another link for users to register to the system and request a cargo policy. The information, password reminder and registration screen are preferably not necessary to the invention. The registration screen allows for insurance companies to attract new prospective clients and to, in some cases, provide insurance rate quotes automatically without human intervention. The policy issuance, recording, rating and certification of shipments, claims management and entire collaborative administration system is distinct and separate from the initial registration process.

The registration page is illustrated in FIG. 48. It prompts the user for identification information (name, address, phone, etc.) as well as information regarding the types of commodities they ship, the origins and destinations they ship to/from, the anticipated monthly volume of shipments, the number of years that the company has been in existence, the average volume of shipments during the past 5 years, the total claims made during the past 5 years and some reference information to evaluate the credit worthiness of the company.

At this- point, the system will respond based on its configuration and registration processing rules as specified by the system administrator. It may be configured to operate in Manual or Automatic mode. Manual mode offers no automated rating or policy issuance. It informs the registrant that his/her information has been directed to an underwriter for processing and that he/she will be informed when a policy has been prepared. The registration information is then directed to the status screens of a selected group of users and e-mails are sent as additional alerts. Any of these users, normally underwriters or brokers, can then assess the information, contact the registrant for additional information or clarification if necessary, and create a customized insurance policy for the user using the underwriting tools that form part of the system. When the policy is complete, the underwriter or broker then specifies that the new policyholder (or Insured) is authorized to use the system (see FIG. 49) and an e-mail is automatically sent out informing the Insured that the system is now ready for use.

Automatic mode provides for fully automated policy issuance and rating. The system administrator first creates a policy on the system and specifies it as the Generic Policy. He/she then builds rules for the application of discounts/premiums to the basic rates based on the registration data. For example, a rule may indicate that a 10% discount on premium rates is given to any company that indicates that they have existed for more than 5 years and a 5% rate premium may be applied to any company that has existed for less than 2 years. As another example of a rating rule, a 10% discount may be given to any company that has over $5 million in projected monthly volume and a 20% premium may be applied for any company with less than $100,000 in monthly volume. A 20% discount may be given to any company whose self-declared data represents a claims-to-volume ratio of less than .05% and a premium of 30% may be given to any company that has a claims to volume ratio of greater than .5%. These rating rules are preferably specified using pull-down lists and are independent of each other and cumulative in their application such that two discounts of 20% and 5% followed by a premium of 10% would result in a net discount of 15% from the basic policy rates. Rules may also specify that an automated rating is unavailable. For example, if a company specifies a projected monthly volume of over $10 million, or has indicated a claims-to- volume ratio greater than 1 %, or ships regularly to certain risky countries, or ships certain restricted commodities, then the system can be configured to refuse to issue an automated rate and instead revert to the first operating style. When the registrant submits his/her information and the system is configured to Automatic, the Generic policy is automatically customized for the new registrant and issued. The rates are set and the new policyholder is presented with the Welcome screen FIG. 47. The Welcome screen presents the user with a number of options, each of which is represented by a hypertext link. These options link to screens that allow the user to record shipments and produce certificates (FIGs. 50-53), record storage declarations (FIGs. 54-55), initiate claims (FIG. 56), query the database for previously entered shipments, declarations and/or claims (FIGs. 57-62), and view the policy and all supporting documents (FIG. 63).

The interactive screens that allow users to record shipments and produce certificates first prompt for the shipment details required to determine compliance with the policy, applicable rates and conditions. These details include the mode of shipment, the conveyance to be used, the commodity to be shipped, the insured value (and currency), and the countries involved in the shipment. The system only lists the commodities and conveyances listed in the policy but must validate that the selected conveyance and commodity are authorized for automated booking, whether the value limits for the selected commodity and conveyance are not exceeded and what the applicable rate and insuring conditions should be. The system also verifies that the countries listed are not specifically excluded from the policy or that they might increase the premium rate due to increased risk. Increased risk premiums and war premiums are tracked separately by the system as the brokerage rates and insurance companies underwriting the risks may be different. The system also checks for special rates and conditions related to the specific commodity, conveyance and countries entered as any special rate would override the basic policy rates. If the user selects the No Risk After Discharge option, then any restriction tied to the country of final destination would be ignored and coverage would extend only to the port/airport of discharge. Finally, the system verifies that the policyholder has no outstanding past due invoices and that the premium would not cause the credit limit to be exceeded.

If one or more of the verifications fail, then the user is presented with a message indicating that the shipment must be referred to an underwriter along with the reason for the referral. When the user accepts the referral, e-mail alerts are sent to the underwriters and brokers tied to the policy and the referral appears on those users Status Screens. If all the verifications listed above are successful, then the user is presented with the applicable premium and insuring conditions and prompted for additional information including the ports of loading and discharge, marks and numbers related to the cargo, any special letter of credit conditions that must appear on the certificate, the cities of origin and final destination, the bill-of-lading date, carrier and vessel, settling agent to use in the event of a claim, and the name to appear on the certificate.

Once again the system performs validation. If the bill-of-lading date is prior to the current date, the difference is verified against the backdating tolerance specified for the conveyance in the Underwriting Screens. If the tolerance is exceeded, then the shipment is referred to underwriters and brokers as above. If it is not exceeded but the bill-of-lading date has already passed, the user is prompted to attest that there are no known or reported losses as of the current time and this attestation is stored with the shipment. For ocean shipments, the vessel used is also validated against a database of sailing vessels and any applicable overage vessel surcharge is added to the premium. Once all validations are complete, the user is issued an insurance certificate on screen that can be printed locally on a printer attached to the user's computer or local area network. The certificate can be presented as an HTML page to be viewed in a browser, as a PDF encoded file to be viewed using Adobe Acrobat software, or as an encrypted file to be downloaded and decrypted for viewing and printing. The preferred implementation utilizes an encryption algorithm that hashes the certificate file using industry standard encryption software and a key that is unique to each policy. Only computers with the correct key will be able to view or print the certificate, and if the encrypted certificate file is changed in any way, the key will not successfully decrypt it, making viewing or printing impossible. For the entry of storage declarations, the system presents a list of named storage locations along with a number of unnamed locations all as specified in the policy. The user enters the values stored at each location and these amounts are checked against the limits for each location, summing all declarations from other Assured's under the same policy. Any limit check failure causes a referral in a manner similar to referred shipments.

The Claims Screen allows users to initiate a claim on a policy. The certificate number is verified as belonging to the user's policy and the submission triggers e-mail notification messages and alerts on the appropriate underwriter and broker Status Screens. The Policy Screen lists the policy and all related documents available for the user to download and view. Control over the accessibility to each document for each user is specified in the Assured Information Screen and Alternate User Information Screen described above.

The Risk Management Screens allow the user to query the database for previously entered shipments, declarations and/or claims. Alternate Users are restricted from viewing any but their own entries however Assured parties are able to view their own information as well as the information entered by all of their Alternate Users.

FIG. 64 is a block diagram of the system according to a preferred embodiment of the present invention. The system comprises : a user profile editor 641 , an insurance request editor 642, an Applicability Definer 643, a premium rate generator 644, a premium rate terms generator 645, a proof of coverage generator 646, a review request generator 647 and a review decision generator 648.

The sequence of steps performed by the system will be clearer when looking at FIG. 65, a flow chart of the steps of the method of issuing cargo insurance under a policy. A user profile is created 650 using the user profile editor 641. An insurance request is also created using the insurance request editor 642 and received 651 by the Applicability Definer 643. It will be understood that although each characteristic of the request should be specified, default values can be determined and used when the user does not provide a specific definition for a characteristic. For example, a default vessel type could be chosen to be a truck and travelling by land so that if a watermelon producer from California does not provide clear information as to the vessel he will use to send watermelons to Canada, it will be assumed that he will use a truck. The Applicability Definer 643 compares 652 the insurance request with the conditions for insurance set forth in the user profile. The Applicability Definer 643 determines 653 if the insurance request falls within the pre-approved conditions of insurance for the user defined in the user profile. If the insurance request falls within the conditions, a premium rate is calculated 654 by the premium rate generator 644, the terms for the premium rate are determined 655 by the premium rate terms generator 645, the insurance is bound to the insurance request 656 and the proof of coverage is issued 657 by the proof of coverage generator 646.

Alternatively and optionally (shown in broken lines), if the insurance request does not fall within the conditions for insurance, a review request is sent 658 by a review request generator 647 to a broker or an underwriter. The broker or the underwriter then takes a review decision on the insurance request to either approve coverage, determine a revised premium rate, determine revised conditions of insurance or deny coverage. A review decision is then sent to the Applicability Definer 643 by the review decision generator 648 which, if the coverage is approved, again calculates the premium rate 654, determines the terms for the premium rate 655, binds the insurance 656 and issues the proof of coverage 657.

FIG. 66 is a flow chart of a method of issuing a cargo insurance policy by an issuer according to a preferred embodiment of the present invention. A generic cargo insurance policy is created 661 comprising at least one basic rate for insurance coverage and stored 662 in a generic policy file. At least one rule is built 663 for applying a discount and/or a premium to the basic rate using potential characteristics of shipments. The potential characteristics comprise potential types of commodities shipped, potential origin and destination countries for shipments, potential volumes of the shipments, potential number of years at least one of a potential shipper and a potential transportation intermediary has been in existence, potential information concerning claims made and potential credit reference information. The rules are stored in a rate calculation table. A set of limit values is built for the potential characteristics. A shipper or a transportation intermediary enters 664 registration data comprising identification information, types of commodities shipped, origin and destination countries for shipments, volumes of the shipments, number of years the at least one of a shipper and a transportation intermediary has been in existence, information concerning claims made and credit reference information and stores 665 the registration data in a registration data file. The registration data file is' retrieved together with the generic policy file 666 and, when the registration data falls within the set of limit values for the potential characteristics, the generic cargo insurance policy is customized using the registration data and the rate calculation table to a customized policy for the shipper.

FIG. 67 shows a method for determining a premium rate for an insurance request under a cargo insurance policy according to another preferred embodiment of the present invention. A basic rate is specified 672 for each available characteristic for a shipment under a policy. An additional risk and war premium rate is then specified 673 for each country under the policy. An overage vessel premium rate table is specified 674 for the policy. An insurable interest, a conveyance type, an origin, a port of loading, a destination and a port of discharge are selected from a list of available characteristics for a shipment under the policy 671. An overall premium rate for the shipment is calculated 675 using the basic premium, the additional premium for. risk and war and the additional premium for overage vessel. FIG. 68 shows a method of determining at least one rule for calculating at least one of a premium and a discount to a basic insurance rate according to another preferred embodiment of the present invention. The method comprises the step of storing data concerning insurance claims filed with an insurance issuer 681. The data comprises at least a shipment origin, a shipment destination, a commodity shipped, an insurance policy and a time period for the claims. A risk factor is identified and determined and is associated with each of the shipment origin, shipment destination, commodity shipped, insurance policy and time period 682. A rule is determined to be applied to the basic insurance rate to calculate one of a premium and a discount using the risk factor 683.

While this invention has been particularly shown and described with reference to a single preferred embodiment, it will be readily appreciated by those of ordinary skill in the art that various changes and modifications may be made without departing from the spirit and scope of the appended claims. For example, the particular formats of the various display screens described herein may be modified as desired. Likewise, the present invention should not be limited to the specific examples described herein since a greater or lesser number of options and functions for each of the menus and submenus that may be displayed on a computer screen are within the scope of this invention.

Claims

The embodiments of the. invention in which an exclusive property or privilege is claimed are defined as follows:

1. A method of issuing cargo insurance under a policy by an issuer comprising the steps of: determining a user profile for a client comprising a subset of conditions for a cargo insurance policy, wherein said subset of conditions comprises at least one clause, at least one premium rate, a definition of allowed cargos and vessel types, a list of allowed destinations and origins and at least one limit for a value of said allowed cargos; receiving an insurance request for cargo insurance from said client comprising at least one of a type of cargo, a vessel type for shipping said cargo, a value of said cargo, an origin for said cargo and a destination of said cargo; _, assessing applicability of said cargo insurance policy for said insurance request by comparing said insurance request with said conditions for said client to determine if said insurance request falls within said conditions for said cargo insurance policy; and when said insurance request falls within said conditions, calculating a premium rate for said insurance request, determining terms for said premium rate, binding insurance to said insurance request and issuing a proof of coverage for said client by said issuer describing said terms for said premium rate and said insurance request.

2. A method as claimed in claim 1 , further comprising a step of, when said insurance request does not fall within said conditions, sending a review request comprising said insurance request and information concerning which condition was not met by said insurance request to at least one of a broker and an underwriter to review said insurance request.

3. A method as claimed in one of claims 1 and 2, wherein said proof of coverage is a certificate of insurance.

4. A method as claimed in one of claims 1 , 2 and 3, wherein said step of calculating a premium rate for said insurance request comprises applying at least one rule for determining one of a discount and a premium to be applied to a basic premium rate for said insurance request.

5. A method as claimed in claim 2, wherein said step of sending a review request comprising using an alert-based messaging system to send said review request.

6. A method as claimed in claim 5, wherein said review comprises at least one of approve coverage for said request, determine a revised premium rate, determine revised conditions of insurance and deny coverage.

7. A method as claimed in claim 6, wherein said revised conditions of insurance are used to modify at least one of said insurance policy and said subset of conditions.

8. A method as claimed in any one of claims 1 to 7, further comprising a step of invoicing said client for said binding of insurance to said insurance request and said issuing a proof of coverage, and wherein said invoicing is done through an alert-based messaging system.

9. A method as claimed in any one of claims 1 to 8, further comprising a step of receiving additional information on said shipment once said binding of insurance to said insurance request has been carried out, said additional information comprising at least one of a port of loading, a port of discharge, marks and numbers related to the vessel, a special letter of credit condition that must appear on said proof of coverage, a city of origin, a city of final destination, a bill-of-lading date, a carrier and vessel identification data, a settling agent to use for claims and a name to appear on said proof of coverage.

10. A method as claimed in claim 9, wherein said bill-of-lading date is verified against a date of said insurance request and, if said bill-of-lading date is previous to said date of said insurance request and a difference between said bill-of-lading date and said date of said insurance request is smaller than a backdating tolerance specified by said issuer, an attestation that there are no known or reported losses with respect to said insurance request as of the date of said insurance request is recorded and stored with said insurance request data.

11. A method as claimed in any one of claims 1 to 10, wherein said determining a user profile comprises creating an electronic user profile and saving said electronic user profile, wherein said step of receiving an insurance request comprises electronically receiving data concerning said insurance request and storing said data in a data storage, wherein said step of assessing applicability comprises retrieving said data from said data storage and retrieving said electronic user profile to compare said insurance request with said conditions and wherein said steps of calculating a premium rate, determining terms for said premium rate, binding insurance and issuing a proof of coverage comprise sending said proof of coverage electronically to said client.

12. A system for issuing cargo insurance under a policy by an issuer comprising: a user profile editor for determining a user profile for a client comprising a subset of conditions for a cargo insurance policy, wherein said subset of conditions comprises at least one of at least one clause, at least one premium rate, a definition of allowed cargos and vessel types, a list of allowed destinations and origins and at least one limit for a value of said allowed cargos; an insurance request editor for creating an insurance request for cargo insurance from said client comprising at least one of a type of cargo, a vessel type for shipping said cargo, a value of said cargo, an origin for said cargo and a destination of said cargo; an applicability definer for receiving said user profile and said insurance request and assessing applicability of said cargo insurance policy for said insurance request by comparing said insurance request with said conditions for said client to determine if said insurance request falls within said conditions for said cargo insurance policy; and when said insurance request falls within said conditions, a premium rate generator for calculating a premium rate for said insurance request, a terms generator for determining terms for said premium rate, an insurance generator for binding insurance to said insurance request and a proof of coverage generator for issuing a proof of coverage for said client by said issuer describing said terms for said premium rate and said insurance request.

13. A method of issuing a cargo insurance policy by an issuer, comprising the steps of: creating a generic cargo insurance policy comprising at least one^" basic rate for insurance coverage and storing said generic policy in a generic policy file; building at least one rule for applying at least one of a discount and a premium to said basic rate using potential characteristics of shipments, wherein said potential characteristics comprise potential types of commodities shipped, potential origin and destination countries for shipments, potential volumes of said shipments, potential number of years at least one of a potential shipper and a potential transportation intermediary has been in existence, potential information concerning claims made and potential credit reference information and storing said rules in a rate calculation table; building a set of at least one limit value for said potential characteristics; at least one of a shipper and a transportation intermediary entering registration data comprising at least one of identification information, types of commodities shipped, origin and destination countries for shipments, volumes of said shipments, number of years said at least one of a shipper and a transportation intermediary has been in existence, information concerning claims made and credit reference information and storing said registration data in a registration data file; retrieving said registration data file and said generic policy file and, when said registration data falls within said set of limit values for said potential characteristics, customizing said generic cargo insurance policy using said registration data and said rate calculation table to a customized policy for said at least one of a shipper and a transportation intermediary.

14. A method as claimed in claim 13, wherein said customized policy is sent using an alert-based messaging system to said at least one of a shipper and a transportation intermediary.

15. A method as claimed in any one of claims 13 to 14, further comprising a step of, when said registration data does not fall within said set of limit values for said potential characteristics, sending a review request comprising said registration data and information concerning which limit value was not met to at least one of a broker and an underwriter to review said registration data.

16. A method as claimed in claim 15, wherein said review comprises at least one of approve a policy for said at least one of a shipper and a transportation intermediary and deny issuing a policy.

17. A method of determining a premium rate for an insurance request under a cargo insurance policy comprising the steps of: specifying rates for each available characteristics for a shipment under a policy; specifying additional risk and war premium rates for each country under said policy; specifying overage vessel premium rate tables for said policy; selecting an insurable interest, a conveyance type, an origin, a port of loading, a destination and a port of discharge to be selected characteristics from a list of available characteristics for a shipment under said policy; calculating a basic premium using said rates and said selected characteristics; calculating an overall premium rate for said shipment using said selected characteristics, said basic premium, said additional premium for risk and war and said additional premium for overage vessel.

18. A method as claimed in claim 17, further comprising a step of storing said overall premium rate for said insurance request and comparing said overall premium rate with other premium rates calculated for other insurance requests to determine a revised rate for available characteristics for said shipment.

19. A method of determining at least one rule for calculating at least one of a premium and a discount to a basic insurance rate comprising the steps of: storing data concerning insurance claims filed, said data at least comprising a shipment origin, a shipment destination, a commodity shipped, an insurance policy and a time period for said claims; identifying and determining a risk factor associated with at least one of said shipment origin, shipment destination, commodity shipped, insurance policy and time period; determining a rule to be applied to said basic insurance rate to calculate one of a premium and a discount using said risk factor.

20. A method as claimed in claim 19, wherein said risk factor is determined using a probability calculation.