Intro to Insurance and Risk Management

1500 words

Part 1

Jim borrowed $700,000 from Suburban Bank to buy a boat for his Alaskan king crab fishing business. He keeps the boat at a dock owned by the Barnacle Company. Jim also has a contract with the Landshark Fishing Company to transport his crabs from one port to another. Include the following in your paper:

• Do any of the following parties have an insurable interest in Jim or his property? If an interest exists, explain the extent of the interest.
  • Suburban Bank
  • Barnacle Company
  • Landshark Fishing Company
• If Jim did not own the boat but operated it on behalf of the Landshark Fishing, would he have an insurable interest in the boat? Explain your answer.

Part 2

The Balut Corporation has 4,000 sales representatives and employees in the United States who drive company trucks. The company’s risk manager has recommended to the firm’s management team that the company should implement a partial retention program for collision losses to company trucks. Include the following in your paper:

• Explain the advantages and disadvantages of a partial retention program to the Balut Corporation.
• Identify the factors that Balut Corporation should consider before it adopts a partial retention program for collision losses for company trucks.

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