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Marine insurance

A marine insurance contract is concerned with a marine adventure: with insuring ships, cargo, passengers, etc. Marine insurance is rather a complex matter. Policies are long and couched in Ianguage both colourful and obscure. The relevant act is the Marine Insurance Act 1906. The risks insured against include damage by fire, storm and tempest, detention by foreign princes, seizure under legal process and dangers occasioned by ‘men-of-war, fire, enemies, pirates, rovers, thieves, jettisons, letters of mart and countermart, surprisals, takings at sea, arrests. restraints, and detainments of all kings. princes, and people of what nation, condition, quality so ever, barratry of the master and mariners, and of all other penis. losses, and misfortunes, that have or shall come to the hurt, detriment or damage of the said goods and merchandises, and ship. etc., or any part thereof. ‘Pirates’ includes passengers who mutiny and rioters who attack the ship from the shore, but ‘thieves’ does not include clandestine thefts by one of the crew or a passenger. This is a general list; any particular policy may exclude some of them or include others.

The insurer must have an insurable interest, i.e. he must personally stand to suffer from the loss insured against. The interest must exist at the time of the loss. though it need not when the policy is signed. Gambling policies where the insured has no interest at any time are likely to be void. The policy holder may even be prosecuted.

Marine insurance policies are policies uberrimae fidei. The contract must take the specific form of a marine insurance policy and must be signed by the insurers. It must state: (1) the name of the insured; (2) the subject matter; (3) the risk; (4) the voyage or period; (5) the sum insured; (6) the name of the insurers. Policies may be voyage policies, time policies or a mixture of the two. They may also be valued or unvalued. A valued policy specifies the agreed value of the subject matter, an unvalued policy does not. On a total loss the holder of an unvalued policy would receive a sum related to the value of the subject matter at the time of the loss. The holder of a valued policy receives the sum insured irrespective of the value at time of loss. A floating policy is a general policy leaving the name of the ship or ships, etc., to be given subsequently. There are various express and implied warranties and if these are not complied with by the insured, the policy may be ineffective, e.g. the ship must be seaworthy at the commencement of each part of the voyage, and also fit to carry the goods. With voyage policies, the ship must sail from the place specified. It must not deviate from the course nor delay unduly. (This does not apply to deviations or delays due to factors outside the master’s control or deviations to help ships in distress, where human life is in danger.) There are other deviations allowed (these are specified in the Act), e.g. for the safety of the ship or other insured matter, or for obtaining medical aid. Marine policies can be assigned by endorsement, unless this is having an interest. It is immaterial whether or not the loss has occurred. There are different forms of loss, and liability varies accordingly.

Reference: The Penguin Business Dictionary, 3rd edt.