Upload
bhajleen-arora
View
214
Download
0
Embed Size (px)
Citation preview
7/31/2019 Lecture 15 - Marine Insurance
1/20
Click to edit Master subtitle style
MARINE INSURANCE
Lecture 15Week 8
7/31/2019 Lecture 15 - Marine Insurance
2/20
DEVELOPMENT
n One of the earliest forms of insurancen Developed out of bottomry and
respondentia bondsn Standard forms used by Lloydsn Marine Insurance Act 1906n Often includes aviation insurancen Different terminology
7/31/2019 Lecture 15 - Marine Insurance
3/20
TYPES OF COVER
n Hulln Cargon Freightn Voyagen Collision
7/31/2019 Lecture 15 - Marine Insurance
4/20
TYPES OF VESSELS COVERED
Dinghies Yachts Cargo vessels Liners Super tankers
Oil rigs Fishing vessels
7/31/2019 Lecture 15 - Marine Insurance
5/20
BASIC COVER
n Perils of the sea and other navigablewaters
n Restraint of princesn Piracyn All risks
7/31/2019 Lecture 15 - Marine Insurance
6/20
FURTHER COVER
n Pollution Hazardn War and strikes clausen Bursting boilers or breaking shaftsn accident or negligence of a third party
7/31/2019 Lecture 15 - Marine Insurance
7/20
IMPLIED WARRANTIES
n Seaworthiness Damaged bottom Insufficient crew
n Legalityn Marine Insurance Act 1906
7/31/2019 Lecture 15 - Marine Insurance
8/20
PARTICULAR AVERAGE
n This means a partial lossn Covers loss caused by:
Perils of the sea rivers lakes or othernavigable waters
fire, explosion violent theft jettison piracy
7/31/2019 Lecture 15 - Marine Insurance
9/20
MEASURE OF INDEMNITY
n s.69 Marine Insurance Act 1906n Where ship has been repaired the
reasonable cost of repairs less thecustomary deductions but notexceeding sum insured
n Where partially repaired cost of repairsplus reasonable depreciation subject tonot exceeding cost of complete repair
n Not repaired - the reasonable
depreciation
7/31/2019 Lecture 15 - Marine Insurance
10/20
EXAMPLES OF ADJUSTMENTSn
Bottom end bearing fractured ingenerator as a result of latent defect ledto damage to liner.
n
Cost Bearing 5000 Liner 4000 Cylinder 3000 Piston 6000 Total 18000
7/31/2019 Lecture 15 - Marine Insurance
11/20
ADJUSTMENT
n Excess 2000n Standard policy would exclude replacing
defective partn Thus total amount payable is 11000
18000 - 5000 (bearing) - 2000(Excess)
n Additional perils clause would havecovered bearing
7/31/2019 Lecture 15 - Marine Insurance
12/20
TOTAL LOSS CLAIMS (SHIP)
n Institute time clausesn Hulls total loss only including salvage,
salvage charges and sue and labourn Hull total loss, general average and
3/4ths collision including salvage etcn Hulls disbursements
7/31/2019 Lecture 15 - Marine Insurance
13/20
TYPES OF TOTAL LOSSn Constructive total loss
Deprived of ship by insured peril Recovery would exceed value or repair exceeds value
n Abandonment Insured entitled to abandon loss when
constructive total loss Consequence is that if insured accepts
notice of abandonment subject to assetsand liabilities. May not acceptabandonment
7/31/2019 Lecture 15 - Marine Insurance
14/20
SUE AND LABOUR CLAUSES
n Covers expenses reasonably incurred byinsured to save vessel and cargo
n Paid in excess of sum insured.
7/31/2019 Lecture 15 - Marine Insurance
15/20
COLLISION LIABILITY
n Covers three quarters of the cost of liability
Rest paid by Protection and Indemnityassociations
n It is a liability policy
7/31/2019 Lecture 15 - Marine Insurance
16/20
CARGO
n Same risks and same methodsn General average clause
Losses arising for the preservation of shipand cargo
n Salvage loss Follows forced sale of badly damaged
cargo
7/31/2019 Lecture 15 - Marine Insurance
17/20
CARGO PARTIAL LOSSn Where goods delivered damage
measure of indemnity is Proportion of sum fixed by policy equal to the gross sound value less
damaged value at place of deliveryn Example
Goods insured at 120,000; Damaged
value = 80,000: Sound value = 100,000 Depreciation or proportion is 20% Apply this to 120,000 gives 24,000
7/31/2019 Lecture 15 - Marine Insurance
18/20
FREIGHT
n Profit made by a shipowners out of ships used to carry cargo, both theirown and others
n The cargo includes all moveablesn Loss occurs when cargo is not
deliverable
7/31/2019 Lecture 15 - Marine Insurance
19/20
FREIGHT LOSS
n Valued and unvalued policiesn Indemnity is the proportion of freight
lost to freight at risk applied to insuredn This could be subject to Measure of
indemnity clause which limits freight toamount actually lost.
7/31/2019 Lecture 15 - Marine Insurance
20/20
THE END
ANYQUESTIONS