Glossary

"Free alongside" is one of several standard terms of sale for exports and imports. When goods are shipped FAS, the seller's responsibility ends when the merchandise is brought alongside the vessel (e.g., in a barge) or placed on the dock from which it will be loaded onto the vessel. The buyer is responsible for insuring the goods from that point on. When goods are shipped FAS, the seller's responsibility ends when the merchandise is brought alongside the vessel (e.g., in a barge) or placed on the dock from which it will be loaded onto the vessel. The buyer is responsible for insuring the goods from that point on.

Free of capture and seizure warranty refers to a clause in ocean marine policies that essentially functions to delete war risk coverage from hull insurance. Losses excluded are those due to nuclear weapons, mines, torpedoes, war (including civil war), piracy, and confiscation or nationalization of property.

Free of particular average is an ocean marine policy provision that eliminates all coverage for any partial loss of cargo.

Free of particular average—American conditions is an ocean marine policy provision that eliminates coverage for partial loss to cargo unless caused by stranding, sinking, fire, or collision.

Free of particular average—English conditions is an ocean marine policy provision that eliminates coverage for partial loss to cargo except in the event of stranding, sinking, fire, or collision (regardless of whether those perils were the proximate cause of the loss).

Free on board (FOB) is one of several standard terms used in contracts of sale to indicate responsibility for damage to goods during shipment. When goods are shipped FOB, the seller's responsibility ends when a carrier takes possession of them, or, with respect to ocean shipments, when the merchandise is placed safely aboard the vessel or when an on board bill of lading has been issued. The buyer is responsible for insuring the goods from that point on.

Free on board destination is one of several standard terms used in contracts of sale to indicate responsibility for damage to goods during shipment. When goods are shipped FOB destination, the seller's responsibility for the goods continues until they are delivered to the buyer in accordance with the contract terms.

A freight broker is a person, firm, or corporation that arranges transportation of commodities for a fee. The broker does no hauling and assumes no responsibility for the property being transported. Under the Interstate Commerce Commission (ICC) Termination Act, brokers are still required to register and file proof of required levels of financial responsibility.

A freight forwarder is an entity that purchases motor service from a licensed motor carrier. Unlike a freight broker, a freight forwarder assumes responsibility for a shipment from origin to destination and typically issues bills of lading. The Interstate Commerce Commission (ICC) Termination Act requires all freight forwarders to register, not only those concerned with household goods. Security requirements must be met, although only household goods (HHG) freight forwarders are required to carry cargo insurance.

Frequency is the likelihood that a loss will occur. Expressed as low frequency (meaning the loss event is possible but has rarely happened in the past and is not likely to occur in the future), moderate frequency (meaning the loss event has happened once in a while and can be expected to occur sometime in the future), or high frequency (meaning the loss event happens regularly and can be expected to occur regularly in the future). Workers compensation losses normally have a high frequency as do automobile collision losses. General liability losses are usually of a moderate frequency, and property losses often have a low frequency.