Page 35 - The Insurance Times August 2024

Bunga Melati Dua–

Pirate Attack!!

Marine Insurance!!

- Historical Maritime Fraud

Dr. Soumi Mukherjee
M.A., PH.D

Marine insurance is one of the earliest forms of insurance type in the history. Its importance
continues because of the massive sea trade traffic. Almost 80% of the world trade travels by sea.
The fact that ships are carrying goods more than people affects both the policies and approach
for vessels and other insurable subjects. Policies are more focused on goods and offer solutions
for them, while crews become a secondary part of the insurances.

M arine insurance is one of the earliest forms of is cash ransom money and not the goods itself. Nowadays

insurance type in the history. Its importance
pirate attacks are mainly seen at three spots which are -
continues because of the massive sea trade
traffic. Almost 80% of the world trade travels by sea. The South East Asia, West Africa-Gulf of Guinea and the most
famous one, the Gulf of Aden-Somalia. Especially, the Gulf
fact that ships are carrying goods more than people affects of Aden is a critical point where one third of international
both the policies and approach for vessels and other insurable oil trade and almost 20.000 vessels pass by from Somalia
subjects. Policies are more focused on goods and offer offshore. Therefore, it is an attractive place for pirates.
solutions for them, while crews become a secondary part
of the insurances. First of all, marine insurance is a contractual relationship
where insurer and ship owner agree on the risks that will
From the first day through present time, seaways have their be covered. However, its coverage could include not just
distinctive dangers and problems. Maybe the most vessels but cargo, terminals, any transport that property is
important issue is piracy. This old way of robbery is still transposed, obtained or held between two destinations.
popular in these days, especially, at African offshore Gulf of Marine insurance is always thought that covers the goods
Aden. By examining the recent cases from Somalia, what during the shipping but in fact it is actually called cargo
can we say about the relation between marine insurance insurance which is a sub-branch of marine insurance. Marine
and risk of piracy? insurance also covers ships, freight and other interests.

Nowadays pirates do not care about the value of the goods Another acknowledged definition of marine insurance can be
or crew. What they aim is to gain a high ransom from ship found in the Marine Insurance Act (MIA) 1906. A contract of
owners without getting into trouble. By this way, they do marine insurance is a contract whereby the insurer undertakes
not take any risks in terms of selling the seized goods in the to indemnify the assured, in manner and to the extent thereby
market and therefore the variety of goods does not affect agreed, against marine losses, that is to say, the losses incident
whether it is saleable or not, because what the pirates care to marine adventure. Marine Insurance Act 1906 is called as

32 August 2024 The Insurance Times