11

MARINE HULL INSURANCEMARINE HULL INSURANCE

22

Marine Hull InsuranceMarine Hull InsuranceMarine Hull Insurance covers loss or damage to hull and machinery

Hull - Structure of the vessel which can be made from wood, steel or any other type of materials and equipment like pulley, crane and steering wheel

Machinery - Equipment that generates the power to move the vessel and control the lighting & temperature system like boiler, engine, cooler, andelectricity generator

33

44

Types of VesselsTypes of Vessels

Ocean Going VesselsOcean Going Vessels

As the name suggests they travel long

distances.

These are commercial ships greater than or equal to 400feet in length or 10,000 gross tons

55

Types of VesselsTypes of Vessels

Short Sea Tonnage

They operate along the sea coast.

They are not exposed to the stresses and strains of an ocean going vessel

66

Types of VesselsTypes of Vessels

Port & River Crafts They operate in the port They are for maneuvering

ships or carrying goods to/from the ship

Some also operate in rivers for carrying goods

77

Some cases of Marine Hull LossesSome cases of Marine Hull Losses

88

14 Dec 96 : Liberian registered bulk carrier “Bright Field” (going downriver with 60,000 metric tons of grain), smashed into a dock housing a Riverwalk mall and hotel complex , A huge amount was paid as Liability

99

Tricolor collision with Kariba

On Saturday, 14 December 2002, at 02:15, Tricolor and the container vessel Kariba collided. The collision occurred due to thick fog. The Tricolor took on water, capsized and sunk within 30 minutes. The crew were rescued from the wreck.

But it doesn’t end here…..

1010

Two days later, on 16 December, the unloaded German cargo vessel Nicola struck the wreck of the Tricolor ,tugs pulled the cargo ship from the wreck on the same day. On Wednesday, 1 January 2003, the Tricolor was struck again. This time, the Turkish tanker Vicky, hit the wreck .Insurer for the Kariba & Tricolor found themselves facing a substantial bill after the sinking of the Tricolor in the English Channel.

1111

Scope of CoverScope of Cover

Perils of the sea, rivers and navigable waters Fire, Lightning and explosion Violent theft by persons from outside the

vessel Jettison (Throwing of cargo from above board the Throwing of cargo from above board the

ship to save the vessel and/or other cargo)ship to save the vessel and/or other cargo) Piracy (Criminal acts of pirates)

1212

Accidents in loading, discharging or shifting cargo or fuel

Bursting of boilers, breakage of shafts Negligence of master , officers, crew and

pilots Negligence of repairers provided they are not

the insured under the policy

1313

Liability of ship-owners for loss of life and personal injury etc. are generally not covered under Marine Hull Polices.

Also any damage caused to the cargo due to negligence of the ship-owner is also not covered.

So how do the ship owners protect themselves against these losses???

1414

For such losses Protection & Indemnity Club (P & I Club) come to rescue.

The members of the club undertake to share the liability

1515

P & I Clubs generally provide cover for the following risks

Damages or compensation for personal injury to any person, death etc.

Shipwreck 1/4th Collision liability (Liability for physical

damage to another vessel, it is not covered under some Marine Hull Polices)

Pollution risks

1616

ExclusionsExclusions Apart from the usual exclusion continued in the Marine

Insurance Act such as willful misconduct of the assured, delay, normal wear and tear, the following specific exclusions are stated in the policy:

War exclusion Strikes Malicious damage Nuclear

Cover against war, strike & malicious damage risks can be obtained on payment of additional premium.

1717

Types of PoliciesTypes of Policies Time Policy

Specifies the period for which the interest is covered

Voyage PolicyIt insures the subject matter at and from one place to another. However, the cover for a specific voyage may be restricted to a time limit within which the voyage has to be completed.

1818

Valuation of the vesselValuation of the vessel

Valuation of the vessel means finding out the market value of the vessel. Since Hull insurance is an agreed value policy, it is

very important for the underwriter to get the value of the vessel.

The valuation certificate can be obtained from a surveyor.

1919

Clauses in Hull InsuranceClauses in Hull Insurance

The below mentioned clauses are drafted by the Institute of London Underwriters and are used by insurance companies in a majority of the countries including India.

Institute Time Clauses: Hull 1-10-83 Institute Voyage Clauses: Hull 1-10-83 Builders Risk Clauses Institute Time Clauses: Hull Port Risks