MARINE CARGO INSURANCE (TIẾNG ANH KINH tế SLIDE)

Marine insurance Marine Insurance covers the loss or damage of ships, cargo, terminals, and any transport or property by which cargo is transferred, acquired, or held between the points

UNIT 10: MARINE CARGO INSURANCE

Marine insurance

 Marine Insurance covers the loss or damage

of ships, cargo, terminals, and any transport

or property by which cargo is transferred,

acquired, or held between the points of origin and final destination

Feature of marine insurance

 It is based on “Utmost good faith”

I.e: both the insured and the insurer’s must disclosed:

- Everything which is in their knowledge and

- Can affect the contract of insurance

 It is a contract of indemnity

Types of marine insurance

 Property insurance: insures against financial loss

resulting from damage to, or destruction of, property

in which the insured has an insurable interest

 Liability insurance: insures against financial loss

resulting from some person or organization making

a claim against the insured for damages because of bodily injury, death, property damage, or some other injury for which the insured is allegedly responsible

   

Total loss or partial loss

 Total loss: the insurer is entitle to take over what ever may remain of the subject matter

 Partial loss: subrogation is to extent of loss paid, excess recovery if any, is to be

disbursed to the insured

In marine insurance, in the case of a partial loss, or emergency repairs to the vessel, average may be

declared This covers situations, where, for example,

a ship in a storm might have to jettison certain cargo

to protect the ship and the remaining cargo

“General average” requires all parties concerned in the venture (Hull/Cargo/Freight/Bunkers) to

contribute to compensate the losses caused to

those whose cargo has been lost or damaged.

'Particular Average' is levied on a group of cargo

owners and not all of the cargo owners.

Insurance premium

 Financial cost of obtaining an insurance cover, paid

as a lump sum or in installments during the

duration of the policy

 A failure to pay premium when due automatically cancels the insurance policy which, upon payment

of the outstanding amount within a certain period, may be restored.

MARINE STANDARD POLICY FORM

THE FORM CONTAINS THE FOLLOWING PARTICULARS:

 NAME OF INSURED: -POLICY NO.:

 VOYAGE OR JOURNEY: -B/L; LR/GR, RR, AWB NO.:

 CLAUSES ATTACHED

 INTEREST/PROPERTY : DESCRIPTION OF THE ITEM WITH

PACKING DETAILS :

 NAME AND ADDRESS OF SURVEYOR AT DESTINATION

 CLAIM SETTLING AGENT:

 PLACE WHERE CLAIM SHALL BE SETTLED:

 POLICY ISSUING OFFICE ADDRESS AND DATE:

 SIGNATURE OF AUTHORISED PERSON:

Comparison Open cover/ open policy

OPEN COVER

 OPEN COVER: FOR REGULAR SHIPMENTS

 AN AGREEMENT OF INSURANCE WITH THE INSURED

 TO GOVERN THE INSURANCE COVERAGE OF FUTURE

TRANSITS OR SHIPMENTS

 COVERAGE LIKE ICC-’A’ OR ‘B’ ETC IS AGREED,

 RATE, TERMS, WARRANTIES, CLAUSES, EXCLUSION ARE AGREED

 VOYAGE BY SEA OR AIR, TRANSHIPMENT IF ANY IS AGREED

 BASIS OF VALUATION OF GOODS IS THERE BUT NO SUM INSURED SPECIFIED IN THE OPEN COVER

 LIMIT PER BOTTOM (SENDING) AND LIMIT PER LOCATION

( ACCUMULATION OF RISK)

OPEN COVER….

 THE INSURER UNDERTAKES TO INSURE ALL SHIPMENTS

DECLARED BY THE INSURED

 THE ASSURED UNDERTAKES TO DECLARE EACH AND EVERY SHIPMENT WHICH COMES WITHIN THE SCOPE OF OPEN

 A DEPOSITE PREMIUM , EQUIVALENT TO ONE TO THREE

MONTH’S TURNOVER SHALL BE ACCEPTED BY INSURER

OPEN COVER…

 FOR LEGAL PURPOSE OPEN COVER IS LIKE A COVERNOTE

AND THEREFORE A STAMPED POLICY OR CERTIFICATE IS ISSUED AGAINST EACH SHIPMENT

 THE ADVANTAGES ARE:

 AUTOMATIC AND CONTINUOUS COVER IN REGARD TO

COVERAGE, RATE, TERMS AND CONDITIONS AND NO NEED FOR ANY NEGOTIATION ON EACH SHIPMENT

 ANY INADVERTANT OMMISSION TO INSURE OR DELAY IN

SHIPMENT ADVICE IS IGNORED BY THE INSURER PROVIDED

THERE IS SUFFICIENT DEPOSIT

 SINCE THE RATE IS AGREED AT INCEPTION AND IT HELPS THE INSURED TO KNOW THE COST OF INSURANCE

 THE INSURER CAN CHECK THE RECORDS OF THE ASSURED ABOUT THE SHIPMENTS COMING UNDER TERMS OF OPEN COVER

OPEN POLICY

 Open Policy/ Floating Policy : A stamped document

 Sum Insured: Estimated Annual Turnover

 Details of cargo or goods to covered, mode of transport, voyage from –to, basis of valuation, Limit per sending, Rate of premium etc are mentioned on the policy

 All the shipments coming under the scope are covered

to the extent sum insured is available

 Policy can be issued for an amount to take care of

shipments for 03 months or so at the commencement and can be increased subsequently but before the sum insured is exhausted

 Policy is issued for 12 months but lapses if the sum

insured is exhausted

Open Policy…

 For increase in S I additional premium at rate agreed is paid

 Fresh policy if sum insured is exhausted

 Declarations are made , giving details of dispatches

made during the fortnight or month as agreed, to

Insurer and S I is reduced accordingly

 Details of dispatch:

GR/RR no Date Description of goods Qty/wt Amount

Balance

 Open policy is issued for inland transit

 At the end of the policy period, the policy is adjusted

and premium against the balance unutilized S I is

refunded

 Advantages of Open Policy:

 Automatic and continuous insurance protection

 Administrative labour is reduced

 Saving in stamp duty

Open Policy…….

 The insurer can check the records of the insured in regard to dispatches made in terms of the open

policy

 The policy can be cancelled by either party after

giving a notice of 30 days

 Location limit at any one location should not exceed

a specified amount mentioned in the open policy

conditions

Cargo insurance

 Cargo insurance is underwritten on the

Institute Cargo Clauses, with coverage on an

A, B, or C basis, A having the widest cover

and C the most restricted Valuable cargo is known as specie

Different types of marine loss

Marine Insurance Claim

Procedure

• In case of loss/damage in transit, a monetary

claim should be lodged with the carrier within the time limit to protect recovery rights

• Appointment of surveyor or claim representative

in agreement with the insurer to determine the

nature, cause and extent of loss/damage

• The surveyor informs the insurer of the

approximate value of loss incurred

• The claim procedure takes from one to three

weeks

Documents Required for

Marine Insurance Claim

 • Original Invoice & packing List – if forming part of Invoice

• Document of declaration of consignment

• Damage Certificate from the carrier

•a Survey Report (SR) (Biên bản giám định)

 a Cargo Outturned Report (COR) (Biên bản dỡ

hàng)

 a Report on Receipt of Cargo (ROROC) (Biên bản nhận hàng với tàu)

How to claim

 Take immediate steps to minimize loss.

 Inform nearest office of the insurance company or claim settling agent mentioned on the policy.

 In case of damage to goods whilst on ship or port, arrange for joint ship survey or port survey.

 Lodge monetary claim with carrier within stipulated time period.

 Submit duly assigned insurance policy/certificate along with the

original invoice and other documents required to substantiate the claim such as:

 • Bill of Lading

• Packing list

• Copies of correspondence exchanged with carriers.

• Copy of notice served on carriers along with acknowledgment/receipt.

• Shortage/Damage Certificate issued by carriers.