A frequent synonym for insurance is “risk management” which reminds us that the underlying principle of all insurance is the sharing of risk, the majority each being prepared to contribute a small amount to alleviate the misfortunes of the minority. This usually takes the form of the Insurance Company or Mutual Association representing the Majority and the Insured the Minority. As ship managers the types of risks to be considered include loss of or damage to a vessel (Hull Insurance), loss or damage caused by a vessel (third party Protection and Indemnity risks) and a number of ancillary risks such as loss of hire and cost of strikes. The risk control mechanism operates through a number of channels: a) Syndicated markets in particular Lloyds of London. b) Commercial insurance companies. c) Mutual Associations including P & I Clubs. d) General Average where the risk of a specific venture (voyage) may be shared by those involved in certain circumstances. This cover provides compensation for loss of or damage to a ship arising out of an accident (marine peril) such as sinking, grounding, fire or mechanical damage. Most Hull and Machinery insurance is arranged or “placed” by insurance brokers – indeed in the case of Lloyds of London only an accredited broker is permitted to place business. It is the broker’s job to find the best deal for his client shipowner and it is normal practice for a large risk such as a fleet of ships to be spread widely over the market. The ship manager may well talk to a number of competing brokers when an insurance placing is being negotiated or renewed, before advising the shipowner of the most appropriate insurance regime for his fleet. Some fleets have split placing e.g. partly in London with a balance being placed directly in overseas markets. Moreover some fleets are split between more than one broker. These arrangements are all designed to increase the competitive element and to ensure the widest possible spread of risk. While always seeking the best deal for the owner, brokers and managers should, however, also recognise the value of continuity and of building up good relationships with underwriters in the longer term.