Premium can be ascertained either by numerical rating system or by judgment method. The numerical rating system evaluates each and every item and marks are assigned to them according to their merits and degrees of influencing risk.

Since the marine perils are varied, the only numerical rating system cannot be successfully utilised.

However, tabulation of statistical experience on many risks can serve the purpose as a basis of supplementary factors for underwriter’s judgment.

Marine insurance grants protection against a large number of perils which are viewed in relation to (i) the inherent character of a large variety of subject-matter of insurance (ii) the effects of season, adverse physical forces and trade customs, (iii) the policy conditions.


Individual insurance account is used for personal valuation by a leading underwriter who enters into the making of marine insurance rates vary materially. The judgment and personal evaluation is very vital in rate making. There are various factors to influence the risk.

The management and ownership are very important factors while risks are evaluated for the purpose of rate making. Residents in India are not permitted to take marine insurance cover with insurance companies in foreign countries without prior permission of RBI.