3. Fishing operations . 



The vessel ovmer pays premiums for hull and protection and 

 indemnity Insurance in order to protect his property against exposure 

 to certain insurable risks. Notwithstanding other factors, the 

 duration and Intensity of exposure to risks depends largely on the 

 kind of fishing operations. Exposure to risk is directly related 

 to number and duration of fishing trips; hence, the length of the 

 fishing period. Yet, except in the case of returned premiums 

 provided for in the Insurance contract, premiums are paid in advance 

 irrespective of the duration and to some degree of Intensity of 

 exposure to risks. In this sense, the cost of insurance differs from 

 other operationeil costs such as fuel, food, supplies, and repairs. 

 The latter costs are related directly while premiums are related 

 inversely to fishing operations, i.e., they are more or less fixed 

 annually. Therefore, other things being equal, the greater the 

 duration of the fishing period the less burdensome the cost of 

 insurance is likely to be. 



The relationship of the fishing period to the incidence of 

 insurance or noninsurance can be seen in table 6. The proportion of 

 Insured vessels in New England increases with the increase in the 

 fishing period. Vessels with a fishing period of ten months or less 

 have a lower proportion of insured vessels (69 percent), while vessels 

 with a fishing period of eleven to twelve months have a higher propor- 

 tion of insured vessels {dk percent) than the sample percentage (77 

 percent). The picture in the Gulf Area is different partly because 

 of extsnsive nonlnsureince practiced by fleet operators which offsets 

 the effect of fishing operations and partly because of a relatively 

 larger number of new and lost vessels in the area, which, in this 

 tabulation, were excluded from the sample. This latter reason 

 affects also the results in California, although the proportion of 

 insured vessels (58 percent) operating from seven to ten months a 

 year is larger than the proportion of Insured vessels (48 percent) 

 with a fishing period no greater than six months. In connection 

 with the fishing period some of the vessel owner's remarks are: "Too 

 expensive for not fishing year round," or vessel is "not working enough," 

 or insxxrance is "too high for what you get out of it for occasional use." 



Another and perhaps more convincing way of showing the effect of 

 fishing operations on noninsurance is to study the relationship of 

 fishing grounds and insurance. Vessels fishing in Canadian waters, 

 in the southern coast of the Gulf Area, and in Central and South 

 America, where exposure to risks is likely t;o be greater and more 

 intense, have a higher proportion of Insured vessels than the sample 

 percentage (lOO percent, 66 percent, and 100 percent, respectively) 



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