IAMI CMFI key terms

The principle requiring both insured and insurer to disclose all material facts honestly when placing or renewing a marine policy. Breach can allow the insurer to avoid the contract, so misrepresentation at inception often underpins later claim fraud.

A financial stake in the insured property or liability such that the insured benefits from its safety and suffers loss from its damage. Absence of insurable interest is a classic indicator of fabricated marine claims.

Any information a prudent underwriter would consider relevant when deciding whether to accept a risk and at what premium. Deliberate non-disclosure of prior losses or cargo hazards is a frequent fraud route.

A loss where the subject matter is not physically destroyed but recovery or repair cost exceeds its insured value, allowing the insured to abandon it to the insurer. Fraudsters sometimes inflate repair estimates to trigger this threshold.

A partial loss affecting only the insured's own property, borne by that insured rather than shared across all cargo interests. Claims for exaggerated partial damage are common in cargo fraud.

A long-standing maritime rule where losses intentionally incurred to save a voyage, such as jettisoned cargo, are shared proportionately among all cargo and ship interests. Fraudulent sacrifice claims exploit this apportionment.

The deliberate throwing overboard of cargo or ship's gear to lighten or stabilise a vessel in peril. Because evidence disappears with the goods, invented jettison claims are difficult to disprove without documentary scrutiny.

The deliberate sinking of a vessel by its owner or with the owner's connivance, usually to claim a total loss. Indicators include calm-weather sinking, crew rescued without distress calls, and recent increases in insured value.

The intentional destruction or abandonment of a ship to create an insurance loss. Investigators look for mismatched voyage plans, removed valuables, and crew hired shortly before the event.

Insurance covering physical damage to the vessel, its engines, and equipment, typically on a marine hull form. Claims require proof of accidental damage rather than wear, tear, or owner-caused loss.

Mutual liability insurance for shipowners covering third-party exposures such as cargo damage, pollution, injury, and wreck removal. Fraudulent or inflated personal injury and cargo liability claims are often directed at P&I clubs.

The transport document that acts as receipt, contract of carriage, and often document of title for seaborne cargo. Clean bills issued for damaged goods, or forged bills, are central to cargo fraud schemes.

A bill of lading notation confirming goods were received in apparent good order and condition when loaded. Falsely clean bills conceal pre-shipment damage and shift liability, indicating documentary fraud.

A mismatch between documents presented, such as weights, dates, ports, or descriptions differing across bills, manifests, and invoices. Unexplained discrepancies are a strong red flag for fabricated cargo claims.

Independent verification of cargo quantity and condition before loading, often by a surveyor or testing company. Genuine reports help disprove claims that goods were damaged before the voyage began.

A formal record by an appointed surveyor describing damage, cause, and estimated repair or loss value. Inconsistent or template-like surveys suggest collusion between surveyor and claimant.

Physical inspection of a vessel and its repair invoices at the yard to confirm work was actually done. Investigators check steel renewal records, paint history, and yard attendance against claimed costs.

Examination of the ship's recorded navigation, engine, and bridge audio data to reconstruct events. Discrepancies with the master's account can reveal fabricated groundings or collisions.

Use of satellite and terrestrial AIS records to trace a vessel's actual route, speed, and stops. Gaps, spoofed positions, or unexplained deviations contradict claimed piracy or casualty locations.

An act of violence, detention, or robbery at sea committed for private ends by a private vessel against another vessel. Fraudulent piracy claims exploit the difficulty of independent verification offshore.

The unlawful seizure or control of a vessel, its cargo, or crew by force or threat. Staged hijackings may involve collusive crews, unrecorded cargo, and ransom demands without independent witnesses.

Specialist insurance reimbursing ransom payments, negotiation costs, and related expenses following a kidnapping. Fictitious or inflated ransom claims require scrutiny of payment trails and negotiator records.

Following the flow of funds from payer through intermediaries to identify beneficiaries and detect staged abductions. Payments to accounts linked to the claimant or crew indicate collusion.

The unlawful taking of goods in transit, at port, or in storage, often reported as mysterious disappearance. Fraud overlaps when claimed quantities exceed shipped quantities or theft is staged to claim insurance.

A loss where goods cannot be accounted for and no evidence of theft or accident exists. Repeated unexplained shortages from the same shipper or warehouse signal possible fabricated claims.

Comparing shipping, warehouse, and sales records to confirm actual quantities moved and lost. Shortfalls between documents and physical stock expose overstated or invented cargo claims.

A demand against the insured for injury, property damage, or economic loss caused to another party. Exaggerated injuries, staged accidents, and inflated repair bills are common in marine liability fraud.

An injury claim alleging a fall on an unsafe vessel surface such as a gangway, deck, or ladder. Fraud indicators include delayed reporting, no witnesses, and injuries inconsistent with the described mechanism.

Independent examination of treatment notes, imaging, and billing to verify claimed injuries and their cause. Pre-existing conditions, gaps in treatment, and mismatched diagnoses undermine personal injury claims.

Covert observation of a claimant's activities to test whether claimed disability or injury is genuine. Video showing heavy lifting or sport contradicts claims of incapacity and supports recovery action.

A documented, unbroken record of who handled evidence, when, and where. Gaps or alterations weaken evidence admissibility and can undermine an otherwise strong fraud case.

Securing physical, digital, and documentary material promptly before it is lost or altered. Early steps include photographing damage, retaining voyage data, and issuing hold notices to third parties.

A formal recorded interview of the insured or claimant, conducted under oath and often with counsel present. Inconsistencies with documents or prior statements can support denial or recovery.

Review of prior and current claims for frequency, repetition, timing, and shared parties or addresses. Patterns such as recurring total losses or common surveyors suggest organised fraud.

A warning indicator that a claim may be fraudulent, such as late reporting, missing documents, or evasive answers. Red flags guide investigation but must be corroborated before an allegation is made.

Tracing payments, invoices, and bank records to identify inflated costs, duplicate billing, or collusion. Shared accounts between claimant, supplier, and surveyor reveal circular fraud arrangements.

Pursuing reimbursement from third parties or fraudsters after paying a claim, including legal action and asset tracing. Effective recovery depends on preserved evidence and timely notification.

A formal disclosure to the relevant financial intelligence or regulatory authority about suspected illicit activity. Marine insurers may file when ransom, bribery, or laundering indicators arise in a claim.

Policies and checks designed to prevent insurance products being used to launder criminal proceeds. Marine cover is vulnerable through inflated premiums, refunds, and third-party payments.

Checking parties, vessels, and payment routes against sanctions lists before paying or covering a claim. Paying a designated party can breach law even when the underlying claim is genuine.