Insurance of British Shipping in Time of War. 
TERMS OF REFERENCE. 
THE Prime Minister desires that a Sub-Committee of the Committee of Imperial 
Defence composed as follows :— 
The Right Hon. F. Huth Jackson (in the Chair), 
Lord Inchcape, 
Sir A. Norman Hill, Secretary, The Liverpool Steam Ship Owners’ 
Asssociation, 
Sir Raymond Beck, Deputy-Chairman of Lloyd’s, 
Mr. Arthur Lindley, 
Captain M. P. A. Hankey (Secretary), 
should meet to consider, without prejudice to the question of policy, whether an 
administratively practicable scheme can be devised for submission to His Majesty’s 
Government, which will secure that, in case of war, British steamships shall not be 
generally laid up, and that oversea commerce shall not be interrupted by reason of 
inability to cover the war risks of ships and cargoes by insurance, and which will also 
secure that the insurance rates shall not be so high as to cause an excessive rise of 
prices. 
Any scheme prepared must be on the basis of reasonable contributions being paid 
by the owners of ships and cargoes towards the cost of insurance. 
2, Whitehall Gardens, S. W., 
May 7, 1913. 
REPORT. 
Part I.—General Principles. 
1. In seeking to devise a scheme which will ensure that, in case of war, British 
steamships shall not be generally laid up, and that oversea commerce shall not be inter 
rupted by reason of inability to cover war risks of ships and cargoes by insurance, and 
which will also secure that the insurance rates shall not be so high as to cause an 
excessive rise in prices, we have kept the following principles in view r :— 
(1.) As laid down in the terms of reference the scheme must be on the basis of 
reasonable contributions being paid bv the owners of ships and cargoes 
towards the cost of insurance. 
(2.) The main object of the State is to keep the trade of the country going and not 
to make a profit. 
(3.) Nevertheless, it is necessary to safeguard the State against incalculable 
financial liabilities, and more particularly against fraud. C’TJj 
(4.) If the scheme is to have any prospect of success it is essential to avoids the 
hostility of any of the interests concerned. It is therefore necessary to 
avoid any step prejudicial to the legitimate business of shipowners, insurance 
brokers, underwriters, merchants, or bankers. 
(5.) The scheme should avoid the appearance of a gratuitous gift from the State to 
a particular trade, at a time when all branches of trade will be very much 
hampered and every class of the population will be subject to unforeseen 
and incalculable risks of loss. 
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