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National Marine Insurance |
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Salient Features
AN OVERVIEW OF RISKS TO WHICH THE CARGO IS EXPOSED DURING TRANSPORTATION
• Standard risks of transport
• Exceptional risks of transport (war, strike or similar)
Scope of Cover
When these risks occur, they may result in either total loss or partial losses. Partial losses can be of two types viz. : -
1. Particular Average -
The term Particular Average refers to physical damage and loss as well as to any loss in weight or quantity suffered by the insured goods during transit.
2. GENERAL AVERAGE -
General Average is a risk specific to marine transport. Therefore, if a vessel is in danger and the only way to prevent the vessel from striking is to throw one persons cargo overboard, then the rest of the cargo owners and the vessel owner will make up the loss to that person in proportion to the value of their goods in relation to the total amount saved.
3. RISKS OF WAR, STRIKE, ETC.
Extent of Cover Provided
The main coverage provided to cargo in the Indian market are as per the Institute Cargo clauses A B & C. These covers are international in nature.
Duration of Cover
1. The risk attaches from the time the goods leave the warehouse or place of storage at the place named in the policy for commencement of transit and continues during ordinary course of transit.
2. The first possibility of termination is upon delivery to the consignees or other final place of storage. The Policy also terminates at any intermediate point if the goods come into the control of the assured for storage other than in ordinary course of transit, for allocation or for re-distribution. A time limit of 60 days is provided to allow completion the final leg of the transit after discharge from overside the overseas vessel at the final port of discharge.
Summary of the covers provided by the Institute Clauses
Institute Cargo Clauses C. This provides the most restricted coverage and subject to the listed exclusions (which we shall examine later) covers loss or damage to the subject matter insured reasonably attributable to
i. Fire or Explosion
ii. Standing, Grounding, Sinking or Capsizing
iii. Overturning or Derailment
iv. Collision or contact of vessel craft or conveyance with any external objects other than water.
v. Discharge of cargo at point of distress.
The insurance also covers loss or damage to the subject matter insured caused by
vi. General Average
vii. Jettison
To sum up, the C clauses provide major casualty coverage during the land or sea transit and tend to be used for cargoes that are not easily damaged e.g. scrap steel, coal etc.
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