On instructions from the assured (the shipowner), the broker prepares a document called a slip for presentation of details of the subject matter (the ship) to underwriters.
The broker first takes the slip to an influential lead underwriter, who, if he accepts the terms sought, stamps the slip, indicating on it the percentage of the risk which he is accepting on behalf of his (Lloyd’s) syndicate or (IUA) company, and initialling or signing it. The broker then approaches a succession of other underwriters, and in the same way obtains lines from each of them, until the risk is totally covered. The broker then prepares details of the cover on a cover note and sends this to the assured for his approval. If the assured approves the terms, a Lloyd’s or Companies policy document is drawn up (depending on where the lead insurance was obtained) with the relevant clauses attached (e. g. Institute Hull Clauses or American Hull Clauses, Institute Strike Clauses, etc. ).
