Page 15 - Insurance Times March 2017 Sample

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Specific details of Marine Policy for exam Details of types of Marine Cargo Policy:

preparation: These are typically seven in number as given below:
1) Specific Policy;
Marine Insurance is distinct from other classes of insurance
in the following aspects: 2) Open Policy/ open cover;
1) Insurable Interest: Unlike other classes of insurance in 3) Special declaration Policy;
Marine Cargo insurance, the insurable interest need
not be there at the time of taking insurance policy but 4) Annual Policy;
claimant is required to establish insurable interest in 5) Custom Duty insurance policy;
the goods at the time of loss. 6) Increased value policy;
2) Commercial Indemnity: The principal of insurable 7) Special storage risk insurance policy.
interest is modified in marine cargo and the value of
the goods is fixed at the time of granting insurance. 1. Specific Policy
The value so fixed or so agreed is the basis of Marine policies are basically transit policies. A marine policy
settlement of claim. covers the physical loss/ damage to goods during transit. A
3) Assignment of policy: Unlike other policies Marine specific policy covers the specific transit e.g. goods in transit
Cargo Policy is freely assignable i.e insured is free to from Delhi to Mumbai - this is one transit and a policy
assign the policy without consent of underwriters. covering transit risks from Delhi to Mumbai will be a specific
4) Recover of Stamp Duty: In Marine Cargo Policies the policy. Once the goods arrive at destination, the policy
stamp duty is recovered from the insured along with ceases and the insured has no further rights under this policy.
premiums.
5) Coverage of War Risks: Any loss or damage to goods 2. Open Policy / Open Cover
by war risks is not covered in Marine insurance just like Open Policy
other insurance the risk of war can be covered on The Marine Insurance Act refers to such policies as floating
payment of additional premium. policies. When a regular trader is sending the goods from
6) Applicability of various Acts: Marine insurance is one place to other places within India, the turnover is quite
complex as compared to other classes of insurance high, the dispatches are frequent in such cases it is quite
because it is governed by various Acts, Rules, cumbersome to the trader to approach the insurer every
Regulations throughout the world. time for taking specific policies. Salient features of open
policy are as under:
7) Survey fee payment: In marine cargo insurance, the
1) Open policies are issued for a maximum period of one
survey fee is first paid by insured/ claimant and this
year.
amount is reimbursed along with claim amount if the
claim is found to be admissible/ payable. 2) Open policies are issued only for inland transit.
8) Proposal Form: In general it is not required but it is 3) It is a stamped document.
mandatory for custom duty insurance, special 4) Sum insured is fixed but can be increased during the
declaration policy etc.
currency of the policy.
9) Detariff: in Marine Cargo insurance, there is no tariff 5) The insured furnish the declarations, which are
and underwriters can grant coverage after assessment accounted for by the insurer.
of the risk, since 1994.
6) Policy will expire after 12 months of insurance on an
10) One policy form: In Marine Cargo there is only one
exhausting of sum insured whichever shall occur first.
policy form and any type of policy can be issued by
attaching relevant clauses. 7) It is a legal document, which can be enforced in the
11) Marine Hull Policy is of 2 types: court of law.
a) Voyage Policy: It is issued for a specific voyage/ 8) If the policy has run 12 months and unutilized sum
transit and in known as specific policy/ voyage insured is available, balance prorate premium is
policy. refunded.
b) Time Policy: This is issued for a particular time e.g. 9) This policy offers automatic and continuous insurance
open policy, special declaration policy. protection.

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