The value of many
shipments depends upon fluctuations in the currency rates, freight, handling
charges, and other expenses. By means of insurance protection will be provided
to goods from any uncontrollable variables.
A contract of
Marine Insurance is defined by section 7 of the Marine Insurance Act of 1909
as:
"A contract
whereby the insurer undertakes to indemnify the assured, in manner and to the
extent thereby agreed, against marine losses, that is to say, the losses
incident to marine adventure." The
purpose of marine insurance is to provide protection against financial loss for
an amount, which is as close as possible to the actual loss recognized. Marine
insurance is a contract by which one party for a specified consideration
promises to pay another party a sum of money on the loss of goods that are
subject to marine transport. Therefore marine insurance is a contract of
indemnity, which is a contract of reimbursement, and the amount redeemable is
measured by the extent of the assured's or the insured's financial loss. The
terms and conditions of the contract entered into with the insurer determine
the amount of reimbursement that is to be received by the insured.
A contract of marine insurance is embodied in a
policy, which specifies:
"1- The name
of the insured, or of some person who effects the insurance on his behalf.
2- The subject matter insured and the risk
insured against.
3- The voyage, or period of time, or both, as
the case may be, covered by the insurance.
4- The sum or sums insured.
5- The names of the insurers."
The promissor in
an insurance contract is called the insurer or underwriter, the person to whom
the promise is made is the insured, assured or the policyholder and finally the
contract is referred as the policy.
In order to avoid
these situations marine cargo insurance has different coverage for different
purposes.
http://uniserve.edu.au/law/pub/icl/marincon/MarineInsuranceandCargoCla.html
http://ra.irv.uit.no/trade_law/documents/insurance/mia_1906/art/mia_1906.html#01
General Average
Loss
55 Section 72(1) says that a general average
loss is any loss or damage voluntarily incurred for the general safety of the
ship and cargo. For example, where goods are thrown overboard in a storm for
the purposes of saving a ship, and the rest of the cargo. The Admiral Zmajevic
(1983) 2 LLR 86.
56 Section 72(3) says that the several
persons interested in the ship, freight and cargo must contribute rateably to indemnify the person
whose goods have been sacrificed against all but his proportion of the general loss.
1.Does your
policy cover perils?
2.Does it cover
war risks and riots?
Due to events
like the Los Angeles 3.Does it cover?
Nature of Marine
Insurance
1
Marine Insurance deals with the insurance of marine risks.
5 There are a number of terms used in
marine insurance, as follows:
5.1 The contract of Marine Insurance
is generally referred to as the Policy;
5.2 The insurer is the underwriter;
5.3 The property insured is called
the subject matter of the insurance;
5.4 The assured's interest in that
subject matter is called the insurable interest;
5.5 The payment or consideration for
which the insurer undertakes to indemnify the
insured is called the premium.
http://ra.irv.uit.no/trade_law/documents/insurance/mia_1906/art/mia_1906.html#01
Does your policy
cover perils. This is damage caused to your goods due to: heavy
weather conditions, salt water damage,
collisions, fires, jettisons (voluntary dumping
overboard of either cargo or ship's
material to protect property from a common danger)?
2.Does it cover war risks and riots? Due to
events like the recent Los Angeles riots and
warlike situations occurring worldwide,
this point needs much attention and consideration.
Situations arise most often without
warning and may result in damage to your merchandise.
3.Does it cover General Average? This is a
loss resulting from a voluntary sacrifice of any
part of the vessel or cargo, or an
expenditure to safeguard the vessel and the remainder of the
cargo. In a declared General Average, the
financial responsibility you bear is determined by
the value of your cargo in relation to the
total values involved in the voyage. This cost can
sometimes total more than the value of
your merchandise.
http://www.ghgcorp.com/ftnet/pubserv/brokerag.html#INSURANCE
MARINE CARGO
INSURANCE AGREEMENT (Sample
Agreement)
Policy Number:
Assured:
Phone:
FAX:
Loss Payee:
Commodity:
Valuation: Amount
of invoice, including all charges therein and including pre-paid and/or
advanced
and/or guaranteed
freight charges, if any, plus 10%. Foreign currency to be converted into
dollars at
current rate of
exchange in New York.
Voyage:
Coverage: Insured
against all risks of physical damage from any external cause, irrespective of
percentage,
including the risks of wars, strikes, riots & civil commotion, from
warehouse to
warehouse.
Rate:
Date of Proposal:
[____] I hereby
authorize (Shipper) to insure all of my shipments on and after
_____________________
subject to the above agreement.
[____] I hereby
decline insurance coverage and fully understand that (Shipper's) limited
liability is
$500.00 per
shipping package (ocean), $9.07 per pound (air) or $0.50 per pound (domestic).
________________________ ________________________ _________________
Name/Title Signature Date of Acceptance/
Declination
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