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MARINE INSURANCEMARINE INSURANCE
MARINE INSURANCE
• Definition – assurer:
– insured:
Perils
• Perils– the sea and damage:
– fire
– errors of navigation– jettison
Perils
– war,riots:
– pilferage:– willful misconduct of master or crew– breakage
Perils
• Exclusions (types of loss excluded):
INSURANCE & INCOTERMS
• Who InsuresExporter Insures Importer Insures
TYPES OF MARINE INSURANCE
• TWO TYPES OF POLICIES:– Simple– Open Policy:
• shipper’s advantages
• to the underwriter
ADJUSTMENT OF CLAIMS
• The Adjustment– in cases of total loss:– Particular Average:
– Example Total invoice $1,000
Insured For 1,000
Invoice Value of Loss 50
Insured in proportion (110%) 55
ADJUSTMENT OF CLAIMS
• General Average
General Average
• Illustration:
General Average
• EXAMPLE
Mkt Value of jettisoned cargo:$20,000
Cost of hull $50,000and engine repairs:
Salvage vessel svcs: $70,000
Disbursements at port $35,000Total Vessel Sacrifice 155,000
General Average
Total to be allowed or to be
made good in general average: $175,000
Value of Cargo (plus sacrifice) 100,000
Value of Vessel (plus sacrifice) 400,000
Total Contributory values $500,000
Rate of General Average 35%
General Average
• The cargo and the vessel will each contribute
General Average
Pays Contribution of Receives Balance
Owed
Cargo $35,000 $20,000 $15,000
Vessel$140,000 $155,000 $15,000
If cargo insured: $0 If uninsured:
TERMS AND CONDITIONS OF COVERAGE
Free From Particular Average (FPA)
TERMS AND CONDITIONS OF COVERAGE
With Average
BASIC CONDITIONS
All Risk
Containerization & Marine Insurance
Problems with Containers
19