Project on Marine Insurance With Reference To New India Assurance Company Ltd

Chapter I INTROD CTION

!"# Insurance is the equitable transfer of the risk of a loss, from one entity to another in exchange for payment. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. An insurer, or insurance carrier, is a company selling the insurance; the insured, or policyholder, is the person or entity buying the insurance policy. The amount to be charged for a certain amount of insurance coverage is called the premium. Risk management, the practice of appraising and controlling risk, has evolved as a discrete field of study and practice. The transaction involves the insured assuming a guaranteed and kno n relatively small loss in the form of payment to the insurer in exchange for the insurer!s promise to compensate "indemnify# the insured in the case of a financial "personal# loss. The insured receives a contract, called the insurance policy, hich details the conditions and circumstances under hich the insured ill be financially compensated. The $ife is full of uncertainties. %eople opt for insurance purely for the reasons of uncertainties in life. Insurance gives the insured a kind of peace of mind as he is assured to making up the loss in the event of such uncertainties in life happen.

The New India Assurance Co" Ltd", based in &umbai, is one of the five public sector insurance companies in India. It is the 'largest general insurance company of India on the basis of gross premium collection inclusive of foreign operations'. It as founded by (orab Tata in )*)*, and nationali+ed in )*,-. %reviously it as a subsidiary of the .eneral Insurance /orporation of India ".I/#. 0ut hen .I/ became a reinsurance company as per the IR(A Act )***, its four primary insurance subsidiaries New India Assurance, 1nited India Insurance, 2riental Insurance and 3ational Insurance got autonomy. 3e India Assurance provides &arine Insurance %olicy as ell as the shipping

/argo policy

hich helps to recover the damage to the ships and the goods during

the travel from origin to the destination. This policy covers goods, freight and other interests against loss or damage to goods hilst being transported by rail, road, sea and4or air.

!"! O$%&CTI'&( O) T*& (T D+ i) To determine and analy+e the &arket %otential of the 3e India Assurance /o. $td. ii) To determine iii) To kno hether the customers are satisfied ith the &arine insurance India Assurance /o. $td policies of the company. the customer a areness regarding the 3e and its products. iv) To study and determine the competitor position in the market. v) To kno policies. the future plans of the people for buying the marine insurance

!", R&'I&W O) LIT&RAT R&

!" %ac-son Mar-, )) 5an, 67)-. The intention behind covering piracy in the hull and cargo claims is to prevent the stunting of trade and trade routes for reasons like barbaric activities. The understanding of the term piracy and pirates has gone far ahead to include passengers the shores. The ho mutiny and rioters ho attack the ship even from idely recogni+ed hull and cargo clauses cover the issues of ho mutiny and rioters ho attack the ship from the shore. hereby the

piracy. According to the &arine Insurance Act, )*8- "India#, the term 'pirates' includes passengers Anyho , piracy is excluded from the paramount ar exclusion clause of IT/9 and I:/9. The test to be applied in this regard is that of proximate cause 9o ever, any loss caused by sei+ure, even if the sei+ure barratrous or piratical act, is not excluded from the may not be a situation loss that has been incurred should not have been caused by barratry or piracy. ere to result from a ar exclusion clause. There

here in the clause of ;piracy< as such may stand deleted

from the marine insurance policies. 0ut the situations demand that the insurers should increase the costs of insurance on account of piracy, especially relating to notorious routes of the times like =omalia, Indonesia, and %hilippines etc.

," Roshan (ahasra.uddhe, 5an 67)- stated that The Indian general insurance industry is likely to gro by around 67> per annum in the coming years because India Assurance said. '(espite of increasing penetration, a top official of 3e the recent past. ?e hope the industry ill see similar gro th in the coming years,' /hairman and India Assurance . =rinivasan said. The penetration o

slo do n in economy, the general insurance industry has gro n by around 67> in

&anaging (irector of 3e of ).@AB>.

the general insurance in India stands at around 7.,>, lo er than the global average

/" Ni-hi0 Wa0a1a0-ar "5an ,, 67)-# gives his revie s as The Indian general insurance industry is likely to gro by around 67> per annum in the coming years because of increasing penetration, a top official of 3e around 67> in the recent past. ?e hope the industry ill see similar gro th in the coming years,' /hairman and India Assurance . =rinivasan said. The penetration o India Assurance said. '(espite slo do n in economy, the general insurance industry has gro n by

&anaging (irector of 3e of ).@AB>.

the general insurance in India stands at around 7.,>, lo er than the global average

2" (hip0y (inha "April )6, 6778# gives revie sC .ood performance of I/I/I $ombard, 3e India, 2riental Insurance and 0aDaD Allian+, pushed the general insurance industry gro th to )8> in AprilAEebruary of !78. The )6 nonAlife players
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together mopped up Rs )F,B)B crore in premium till Eebruary last fiscal even as 3ational Insurance "3I/# and Reliance .eneral continued to see decline in business, according to data compiled by IR(A. &arket leader 3e India Assurance collected Rs B,6F) crore in first year premium by logging )@> gro th to corner 6-.-> of the market. GolkataAbased 3I/ had a market pie of ),.B>. (elhiAbased 2riental Insurance Insurance gre as at second spot despite seeing 8.@> decline in premium income at Rs -,676 crore and as close behind 3I/ by collecting Rs -,677 crore in premium and a market share of ),.B>. 1nited India by mere @.,> to garner )@.B> of the market after it collected Rs 6,F-* crore in premium.

!"/ *+POT*&(I( i) The ne technologies adopted by the 3e India Assurance /o. $td acts as a

tool for improving the performance of the company. ii) It has reduced the role of other %rivate sector insurance company<s H made the &arine insurance policies hich are effective to the customers.

!"2 M&T*&DODLO3+ (tudy of (econdary data The secondary data required for the study are obtained from books, Dournals, official<s reports; periodicals brought by the .overnment of India in addition to these, efforts ould be made to collect as much information from the internet about the &arine Insurance Industries in India.
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!"4 LIMITATION( O) T*& (T D+ Though this study is purely explorative in nature, it is brought ith a number of limitations. The most outstanding among them could be listed as follo s. i) Adequate secondary data are not available regarding financial aspects of 3e India Assurance /o. $td. ii) This study concentrates more on the role and performance of 3e Assurance /o. $td life insurance sector. iii) This study does not analy+e the problems faced by the customers. iv) =tudy of primary data is not available. India ithout considering the role played by the company in

Chapter II M&ANIN3 O) IN( RANC&

,"# Insurance is the equitable transfer of the risk of a loss, from one entity to another in exchange for payment. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. An insurer, or insurance carrier, is a company selling the insurance; the insured, or policyholder, is the person or entity buying the insurance policy. The amount to be charged for a certain amount of insurance coverage is called the premium. Risk management, the practice of appraising and controlling risk, has evolved as a discrete field of study and practice. The transaction involves the insured assuming a guaranteed and kno n relatively small loss in the form of payment to the insurer in exchange for the insurer!s promise to compensate "indemnify# the insured in the case of a financial "personal# loss. The insured receives a contract, called the insurance policy, hich details the conditions and circumstances under hich the insured ill be financially compensated. Insurance is a form of risk management in hich the insured transfers the cost of

potential loss to another entity in exchange for monetary compensation kno n as premium. Insurance allo s individuals, businesses and other entities to protect
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themselves against significant potential losses and financial hardship at a reasonably affordable rate. ?e say 'significant' because if the potential loss is small, then it doesn!t make sense to pay a premium to protect against the loss. After all, you ould not pay a monthly premium to protect against a I@7 loss because ho are exposed to similar risk, participate in the this ould not be considered a financial hardship for most. Insurance is a technique herein a number of people, scheme and contribute in the shape of periodic premiums. =uch premiums are received by the insurer ho is able to pay out of the premiums received by him, for the losses of some of those ho have participated in the scheme. Thus it is onderful technique of spreading and transfer or risks. Jveryone that ants to protect themselves or someone else against financial

hardship should consider insurance. This may includeC

%rotecting family after one!s death from loss of income Jnsuring debt repayment after death /overing contingent liabilities %rotecting against the death of a key employee or person in your business 0uying out a partner or coAshareholder after his or her death %rotecting your business from business interruption and loss of income %rotecting yourself against unforeseeable health expenses %rotecting your home against theft, fire, flood and other ha+ards %rotecting yourself against la suits %rotecting yourself in the event of disability

%rotecting your car against theft or losses incurred because of accidents And many more

,"! ORI3IN O) IN( RANC& ?henever there is uncertainty there is risk. ?e do not have any control over uncertainties hich involves financial losses. The risk may be certain events like death, pension, retirement or uncertain events like theft, fire, accident; etc. Insurance is a financial service for collecting the savings of the public and providing them ith risk coverage. It comes under service sector and hile marketing this service due care is taken in quality product and customer satisfaction. The main function of the Insurance is to provide protection against the possible chances of generating losses. The insurance sector in India has come a full circle from being an open competitive market to nationali+ation and back to a liberali+ed market again. Tracing the developments in the Indian insurance sector reveals the -87Adegree turn some sense itnessed over a period of almost t o centuries. In ith the appearance e can say that insurance appears simultaneously

of human society. ?e kno of t o types of economies in human societiesC natural or nonAmonetary economies and more modern monetary economies " ith markets, currency, financial instruments and so on#. The former is more primitive and the insurance in such economies entails agreements of mutual aid. If one family!s house is destroyed the neighbors are committed to help rebuild.

,", *I(TOR+ O) IN( RANC&

9

Turning to insurance in the modern sense "i.e., insurance in a modern money economy, in hich insurance is part of the financial sphere#, early methods of ere practiced by /hinese and 0abylonian traders ould redistribute their ares across many transferring or distributing risk

as long ago as the -rd and 6nd millennia 0/, respectively. /hinese merchants travelling treacherous river rapids developed a system hich vessels to limit the loss due to any single vessel!s capsi+ing. The 0abylonians as recorded in the famous /ode of 9ammurabi, c. ),@7 0/, and practiced by early &editerranean sailing merchants. If a merchant received a loan to fund his shipment, he ould pay the lender an additional sum in exchange for the lender!s guarantee to cancel the loan should the shipment be stolen or lost at sea. The business of life insurance in India in its existing form started in India in the year)F)F areC )*)6C The Indian $ife Assurance /ompanies Act enacted as the first statute to regulate the life insurance business. )*6FC The Indian Insurance /ompanies Act enacted to enable the government to collect statistical information about both life and nonAlife insurance businesses. )*-FC Jarlier legislation consolidated and amended to by the Insurance Act the obDective of protecting the interests of the insuring public. )*@8C 6B@ Indian and foreign insurers and provident societies taken over by the central government and nationali+ed. $I/ formed by an Act of %arliament, vi+. $I/ Act, )*@8, ith a capital contribution of Rs. @ crore from the .overnment of India. The .eneral insurance business in India, on the other hand, can trace its roots to the Triton Insurance /ompany $td., the first general insurance company established in the year )F@7 in /alcutta by the 0ritish.
10

ith the establishment of the 2riental $ife Insurance /ompany in

/alcutta. =ome of the important milestones in the life insurance business in India

ith

=ome of the important milestones in the general insurance business in India areC )*7,C The Indian &ercantile Insurance $td. set up, the first company to transact all classes of general insurance business. )*@,C .eneral Insurance /ouncil, a ing of the Insurance Association of India, frames a code of conduct for ensuring fair conduct and sound business practices. )*8FC The Insurance Act amended to regulate investments and set minimum solvency margins and the Tariff Advisory /ommittee set up. )*,6C The .eneral Insurance 0usiness "3ationali+ation# Act, )*,6 nationali+ed the general insurance business in India ith effect from )st 5anuary )*,-. )7, insurers amalgamated and grouped into four companies< vi+. the 3ational Insurance /ompany $td., the 3e a company. ,"/ PRINCIPL&( O) IN( RANC& Insurance involves pooling funds from many insured entities "kno n as exposures# to pay for the losses that some may incur. The insured entities are therefore protected from risk for a fee, ith the fee being dependent upon the frequency and severity of the event occurring. In order to be insurable, the risk insured against must meet certain characteristics in order to be an insurable risk. Insurance is a commercial enterprise and a maDor part of the financial services industry, but individual entities can also selfAinsure through saving money for possible future losses. India Assurance /ompany $td., the 2riental Insurance /ompany $td. and the 1nited India Insurance /ompany $td. .I/ incorporated as

11

tmost 3ood )aith tmost 3ood )aith is a very basic and first primary principle of

%rinciple of

insurance. According to this principle, the insurance contract must be signed by both parties "i.e. insurer and insured# in an absolute good faith or belief or trust. The person getting insured must illingly disclose and surrender to the insurer his complete true information regarding the subDect matter of insurance. The insurer!s liability gets void "i.e. legally revoked or cancelled# if any facts, about the subDect matter of insurance are either omitted, hidden, falsified or presented in a manner by the insured. Insura.0e Interest The principle of insurable interest states that the person getting insured must have insurable interest in the obDect of insurance. A person has an insurable interest hen the physical existence of the insured obDect gives him some gain but its nonA
12

rong

existence

ill give him a loss. In simple

ords, the insured person must suffer

some financial loss by the damage of the insured obDect. )or e5amp0eC A The o ner of a taxicab has insurable interest in the taxicab because he is getting income from it. 0ut, if he sells it, he insurable interest left in that taxicab. Princip0e Of Indemnity Indemnity means security, protection and compensation given against damage, loss or inDury. According to the principle of indemnity, an insurance contract is signed only for getting protection against unpredicted financial losses arising due to future uncertainties. Insurance contract is not made for making profit else its sole purpose is to give compensation in case of any damage or loss. In an insurance contract, the amount of compensations paid is in proportion to the incurred losses. The amount of compensations is limited to the amount assured or the actual losses, hichever is less. The compensation must not be less or more than the actual damage. /ompensation is not paid if the specified loss does not happen due to a particular reason during a specific time period. Thus, insurance is only for giving protection against losses and not for making profit. 9o ever, in case of 0ife insurance, the principle of indemnity does not apply because the value of human life cannot be measured in terms of money. Princip0e Of Contri.ution %rinciple of /ontribution is a corollary of the principle of indemnity. It applies to all contracts of indemnity, if the insured has taken out more than one policy on the same subDect matter. According to this principle, the insured can claim the compensation only to the extent of actual loss either from all insurers or from any
13

ill not have an

one insurer. If one insurer pays full compensation then that insurer can claim proportionate claim from the other insurers. Princip0e Of (u.ro6ation =ubrogation means substituting one creditor for another. %rinciple of =ubrogation is an extension and another corollary of the principle of indemnity. It also applies to all contracts of indemnity. According to the principle of subrogation, hen the insured is compensated for the losses due to damage to his insured property, then the o nership right of such property shifts to the insurer. This principle is applicable only hen the damaged property has any value after the event causing the damage. The insurer can benefit out of subrogation rights only to the extent of the amount he has paid to the insured as compensation. Princip0e Of Loss Minimi7ation According to the %rinciple of $oss &inimi+ation, insured must al ays try his level best to minimi+e the loss of his insured property, in case of uncertain events like a fire outbreak or blast, etc. The insured must take all possible measures and necessary steps to control and reduce the losses in such a scenario. The insured must not neglect and behave irresponsibly during such events Dust because the property is insured. 9ence it is a responsibility of the insured to protect his insured property and avoid further losses. Princip0e Of Causa Pro5ima %rinciple of Causa Proxima "a $atin phrase#, or in simple Jnglish %rinciple of %roximate "i.e. 3earest# /ause, means ords, the

hen a loss is caused by more

than one causes, the proximate or the nearest or the closest cause should be taken
14

into consideration to decide the liability of the insurer. The principle states that to find out hether the insurer is liable for the loss or not, the proximate "closest# and not the remote "farest# must be looked into. )or e5amp0eC A A cargo ship!s base entered and cargo as punctured due to rats and so sea ater

as damaged. 9ere there are t o causes for the damage of the ater is insured but the first ater hich is insured and

cargo ship A "i# The cargo ship getting punctured because of rats, and "ii# The sea ater entering ship through puncture. The risk of sea cause is not. The nearest cause of damage is sea therefore the insurer must pay the compensation. 9o ever, in case of life insurance, the principle of Causa Pro5ima does not apply. ?hatever may be the reason of death " hether a natural death or an unnatural death# the insurer is liable to pay the amount of insurance.

,"2 T+P&( O) IN( RANC&

15

!" Life Insurance $ife insurance provides a monetary benefit to a decedent!s family or other designated beneficiary, and may specifically provide for income to an insured person!s family, burial, funeral and other final expenses. $ife insurance policies often allo the option of having the proceeds paid to the beneficiary either in a lump sum cash payment or an annuity. Annuities provide a stream of payments and are generally classified as insurance because they are issued by insurance companies, are regulated as insurance, and require the same kinds of actuarial and investment management expertise that life insurance requires. Annuities and pensions that pay a benefit for life are sometimes regarded as insurance against the possibility that a retiree ill outlive his or her financial resources. In that sense, they are the complement of life insurance and, from an under riting perspective, are the mirror image of life insurance. /ertain life insurance contracts accumulate
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cash values,

hich may be taken by the insured if the policy is surrendered or ealth hen it is

hich may be borro ed against. =ome policies, such as annuities and endo ment policies, are financial instruments to accumulate or liquidate needed. In the 1=, the tax on interest income on life insurance policies and annuities is generally deferred. 9o ever, in some cases the benefit derived from tax deferral may be offset by a lo return. ," 3enera0 Insurance Also kno n as nonAlife insurance, general insurance is normally meant for a shortA term period of t elve months or less. .eneral insurance means managing risk against financial loss arising due to fire, marine or miscellaneous events as a result of contingencies, hich may or may not occur. Recently, longerAterm insurance agreements have made an entry into the business of general insurance but their term does not exceed five years. .eneral insurance can be classified as follo sC )ire Insurance Eire insurance provides protection against damage to property caused by accidents due to fire, lightening or explosion, hereby the explosion is caused by boilers not being used for industrial purposes. Eire insurance is a contract under the financial loss hich the insurer in return for a consideration "premium# agrees to indemnify the insured for hich the latter may suffer due to destruction of or damage to hich property or goods, caused by fire, during a specified period. The contract specifies the maximum amount, agreed to by the parties at the time of the contract, the insured can claim in case of loss. This amount is not, ho ever, the measure of the loss. The loss can be ascertained only after the fire has occurred. The insurer is

17

liable to make good the actual amount of loss not exceeding the maximum amount fixed under the policy. A fire insurance policy cannot be assigned ithout the permission of the insurer

because the insured must have insurable interest in the property at the time of contract as ell as at the time of loss. The insurable interest in goods may arise out on account of "i# o nership, "ii# possession, or "iii# contract. A person interest but also the interest of others in them. Marine Insurance &arine insurance basically covers three risk areas, namely, hull, cargo and freight. The risks hich these areas are exposed to are collectively kno n as '%erils of the =ea'. These perils include theft, fire, collision etc. &arine /argoC &arine cargo policy provides protection to the goods loaded on a ship against all perils bet een the departure and arrival goods by sea as arehouse. Therefore, marine cargo covers carriage of ell as transportation of goods by land. &arine 9ullC &arine hull ith a limited interest in a property or goods may insure them to cover not only his o n

policy provides protection against damage to ship caused due to the perils of the sea. &arine hull policy covers threeAfourth of the liability of the hull o ner "shipA o ner# against loss due to collisions at sea. The remaining )4Bth of the liability is looked after by associations formed by shipAo ners for the purpose "% and I clubs#. Misce00aneous As per the Insurance Act, all types of general insurance other than fire and marine insurance are covered under miscellaneous insurance. =ome of the examples of general insurance are motor insurance, theft insurance, health insurance, personal accident insurance, money insurance, engineering insurance etc. &iscellaneous
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Insurance refers to contracts of insurance other than those of $ife, Eire and &arine insurance. It covers a variety of risks, the chief of hich areCA Persona0 Accident insurance8 9 %ersonal Accident insurance is insurance for individuals or groups of persons against any personal accident or illness. The risk insured is the bodily inDury resulting solely and directly from accident caused by violent, external and visible means. In India this type of insurance is done by the .eneral Insurance /orporation. A contract of personal accident insurance is not a contract of indemnity and the insurer has to pay a fixed sum of money on the death or total disablement of the insured or provide medical benefits for recovery from the inDury. If risks against certain specified diseases are also covered, the policy is kno n as !%ersonal Accident and =ickness Insurance. Motor 'ehic0e Insurance8 9 under it, a personal or commercial vehicle is subDected to combined insurance against the risks of CA "i# loss or damage to the motor vehicle and its accessories on account of accident or theft; "ii# death of or inDury to the o ner or passenger of the vehicle due to accident; "iii# damages payable to third parties by the o ner of the vehicle for accident. A comprehensive insurance policy may be taken to cover all these risks. Insurance against the first t o types of risks is optional. 0ut every o ner of motor vehicle is required to take out an insurance policy to cover the third party risks under the &otor :ehicles Act, )*@8. =uch a policy is kno n as !third party insurance or liability insurance!. 1nder such a policy, the third party ho has suffered any loss can sue the insurer directly even though he as not a party to the contract of insurance. This policy provides ho have insurable insurance cover to o ners of the vehicle, financiers or lessee, interest in a motor vehicle.

19

)ide0ity Insurance8 9 under it, the insurer undertakes to compensate the insured i.e. the employers against the losses suffered by him due to the employees. The losses may be due to fraud, dishonesty, and misappropriation of funds, goods or damages to property caused by the employees. In order to avail the protection under it, the employer is required to provide all material facts about their employees to the insurer and also, notify all changes in the condition of their service. Credit Insurance8 9 /redit Insurance is a policy taken to cover the loss hich may arise due to bad debts or nonApayment of dues by the debtors. It provides protection to businessmen, ho sell goods on credit terms hile substantially reducing the overall risk of exposure to nonApayment. It protects them against losses arising out of insolvency of their debtors. It thus enables a business to take advantage of peak and cyclical selling periods and to safely expand into ne product lines or territories. Tra1e0 insurance8 9 Travel insurance provides protection cover to all those individuals travelling outside India against risks such as loss of baggage, travel related accidents including inDuries, illnesses and medical emergencies requiring hospitali+ation treatment. In India, this insurance policy has become popular among International travelers.

,"4 (OM& PLA+&R( IN T*& IN( RANC& IND (TR+

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Chapter III MARIN& IN( RANC&

21

/"# &arine insurance covers the loss or damage of ships, cargo, terminals, and any transport or cargo by hich property is transferred, acquired, or held bet een the points of origin and final destination. /argo insurance K discussed here K is a subAbranch of marine insurance, though &arine also includes 2nshore and 2ffshore exposed property "container terminals, ports, oil platforms, pipelines#; 9ull; &arine /asualty; and &arine $iability. &aritime insurance as the earliest ellAdeveloped kind of insurance, ith origins ere

in the .reek and Roman maritime loan. =eparate marine insurance contracts

developed in .enoa and other Italian cities in the fourteenth century and spread to northern Jurope. %remiums varied ith intuitive estimates of the variable risk from seasons and pirates. In the )*th century, $loyd!s and the Institute of $ondon 1nder riters "a grouping of $ondon company insurers# developed bet een them standardi+ed clauses for the use of marine insurance, and these have been
22

maintained since. These are kno n as the Institute /lauses because the Institute covered the cost of their publication. ?ithin the overall guidance of the &arine Insurance Act and the Institute /lauses parties retain a considerable freedom to contract bet een themselves. A contract of marine insurance is an agreement hereby the insurer undertakes to hen any insurable

indemnify the assured, in the manner and to the extent agreed, against losses incidental to marine adventure. There is a marine adventure property is exposed to maritime perils i.e. perils consequent to navigation of the sea. The term !perils of the sea! refers only to accidents or causalities of the sea, and does not include the ordinary action of the inds and aves. 0esides, maritime perils include, fire, ar perils, pirates, sei+ures and Dettison, etc.

/"! ID&MNIT+ A marine policy typically covered only threeAquarter of the insured!s liabilities to ards third parties. The typical liabilities arise in respect of collision another ship, kno n as 'running do n' "collision 'harbour'#, and example#. In the )*th century, shipAo ners banded together in mutual under riting clubs kno n as %rotection and Indemnity /lubs "%HI#, to insure the remaining oneA quarter liability amongst themselves. These /lubs are still in existence today and have become the model for other speciali+ed and noncommercial marine and nonA marine mutual<s, for example in relation to oil pollution and nuclear risks.
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ith

ith a fixed obDect is a

reck removal "a

reck may serve to block a harbour, for

/lubs

ork on the basis of agreeing to accept a shipAo ner as a member and

levying an initial 'call' "premium#. ?ith the fund accumulated, reinsurance ill be purchased; ho ever, if the loss experience is unfavorable one or more 'supplementary calls' may be made. /lubs also typically try to build up reserves, but this puts them at odds ith their mutual status.

/", )&AT R&( O) MARIN& IN( RANC& )# /omprehensive L Accidental loss or damage cover and also includes theft of the boat and4or its contents and personal effects, malicious damage and transit damage, if the vessel is designed to be transported on its o n trailer. 6# Third %arty 2nly L Restricted to damage or inDury that you cause to a third party. -# Jxtended 0lue ?ater Macht Racing L A policy extension for 0lue ?ater racing provided that operator and boat meet under riting criteria "conditions apply# B# 0lue ?ater /ruising L A policy extension for 0lue ?ater racing provided that operator and boat meet under riting criteria "conditions apply#. @# /ommercial 1se L A policy extension to allo commercial activities "conditions apply#. 8# Transit Risk L /over oneAoff transit risks for boats that are not designed to be normally transported on land e.g. large po er boats and fixed keel yachts generally longer than *.7metres. /"/ &L&M&NT( O) MARIN& IN( RANC&
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your boat to be involved in

A" )eatures of 3enera0 Contract A marine insurance policy must fulfill all the essentials of a valid contract i.e. offer, acceptance agreement, competent party, free consent, legal obDects and la ful consideration. In marine insurance, the proposal may be offered by a ship o ner or a cargo o ner or a freight receiver. 9e is the insured. ?hen the insurer accepts the proposal, it becomes an agreement. The insurer is kno n as 1nder riter. $" Insura.0e InterestC =ection ,, F and * to )8 provide for insurable interest. An insured person ill have insurable interest in the subDectAmatter here he stands in any legal or equitable relation to the subDectAmatter in such a ay that he may benefit by the safety or due arrival of insurable property or may be preDudiced by its loss, or by damage thereto or by the detention thereof or may incur liability in respect thereof. =ince marine insurance is frequently affected before the commercial transactions to hich they apply are formally completed it is not essential for the assured to have an insurable interest at the time of effecting insurance, though he should have an expectation of acquiring such an interest. If he fails to acquire insurable interest in due course, he does not become entitled to indemnification. =ince the o nership and other interest of the subDect matter often change from hands to hands, the requirement of the insurable interest to be present only at the time of loss makes a marine insurance policy freely assignable.

C" tmost 3ood )aithC

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=ection )*, 67, 6) and 66 of the &arine Insurance Act )*8- explained doctrine of utmost good faith. The doctrine of caveat emptor "let the buyer be are# applies to commercial contracts, but insurance contracts are based upon the legal principle of uberrimae fides "utmost good faith#. If this is not observed by either of the parties, the contract can be avoided by the other party. The duty of the utmost good faith applies also to the insurer. 9e may not urge the proposer to affect an insurance hich he kno s is not legal or has run off safely. 0ut the duty of disclosure of material facts rests highly on the insured because he is a are of the material common in other branches of insurance are not used in the marine insurance. =hips and cargoes proposed for insurance may be thousands of miles a ay, and surveys on under riters! behalf are usually impracticable. The assured, therefore, must disclose all the material information contract. D" Doctrine of IndemnityC 1nder =ection - of the Act at is provided !A contact of marine insurance is an agreement hereby the insurer undertakes to indemnify the assured in the manner and the extent agreed upon. The contract of marine insurance is of indemnity. 1nder no circumstances an insured is allo ed to make a profit out of a claim. In the absence of the principle of indemnity it as possible to make a profit. The insurer agrees to indemnify the assured only in the manner and only to the extent agreed upon. &arine insurance fails to provide complete indemnity due to large and varied nature of the marine voyage. The basis of indemnity is al ays a cash basis as under riter cannot replace the lost ship and cargoes and the basis of indemnification is the value of the subDectAmatter. &" Princip0e of (u.ro6ation
26

hich may influence the decision of the

=ection ,* of the Act explains doctrine of subrogation. The aim of doctrine of subrogation is that the insured should not get more than the actual loss or damage. After payment of the loss, the insurer gets the light to receive compensation or any sum from the third party from hom the assured is legally liable to get the amount of compensation. At the same time the right of subrogation must be distinguished from abandonment. If property is abandoned to a marine insurer, he is entitled to hatever remains to the property irrespective of value of subrogation. )" Warranties8 A arranty is that by hich the assured undertakes that some particular thing shall or shall not be done, or that some conditions shall be fulfilled or statement according to hereby he affirms or negatives the existence of a particular state of facts. ?arranties are the hich insured person promises to do or not to do a particular thing or to fulfill or not to fulfill a certain condition. It is not merely a condition but statement of fact. ?arranties are more vigorously insisted upon than the conditions because the contract comes to an end if a arranty is broken hether the arranty as material or not. In case of condition or representation the contract comes to end only hen these ere material or important. 3" Pro5imate Cause8 According to =ection @@ ")# &arine Insurance Act,! =ubDect to the provisions of the Act and unless the policy other ise provides the insurer is liable for any loss proximately caused by a peril insured against, but subDect to as aforesaid he is not liable for any loss hich is not proximately caused by a peril insured against.! =ection @@ "6# enumerates the losses hich are not payable are "i# misconduct of

the assured "ii# delay although the delay be caused by a peril insured against "iii#
27

ordinary

ear and tear, ordinary leakage and breakage inherent vice or nature of

the subDect matter insured, or any loss proximately caused by rates or vermin or any inDury to machinery not proximately caused by maritime perils. Thus the proximate cause is the actual cause of the loss. There must be direct and nonA intervening cause. The insurer peril insured against. *" Assi6nment8 A marine policy is assignable unless it contains terms expressly prohibiting assignment. It may be assigned either before or after loss. A marine policy may be assigned by endorsement thereon or on other customary manner. A marine policy is freely assignable unless assignment is express prohibited. A marine policy is not an incident of sale. =o, if there is intention to assign a policy )*8- states, ?here the assured has parted hen interest passes, there must be an agreement to this effect. =ections @- of the &arine Insurance Act, ith or lost his interest in the subDectA matter insured and has not, before or at time of so doing, expressly or impliedly agreed to assign the policy, any subsequent assignment of the policy is inoperative. =ection ), of the Act states, '?here the asserted assigns or other ise parts assignee his rights under the contracts of insurance. ith his interest in the subDectAmatter insured, he does not thereby transfer to the ill be liable for any loss proximately caused by

/"2 T+P&( O) MARIN& IN( RANC&

28

 Car6o InsuranceC /argo insurance caters specifically to the cargo of the ship and also pertains to the belongings of a ship<s voyagers. &arine cargo Insurance is the insurance of property as it moves from place to place. The ord ;marine< conDures up the sea and foremost in the minds of the of the &arine Insurance Act )*78 "&IA# riters as indeed sea transits. ?hile the

Act in its opening sections refers to ;marine losses< and to the ;marine adventure< and to ;maritime perils<, marine insurance departments insure property conveyed by aircraft and road and rail vehicles as and the Act makes provision for them. *u00 Insurance8 9ull insurance mainly caters to the torso and hull of the vessel along ith all the articles and pieces of furniture in the ship. This type of marine insurance is mainly taken out by the o ner of the ship in order to avoid any loss to the ship in case of any mishaps occurring. Lia.i0ity Insurance8 $iability insurance is that type of marine insurance here compensation is sought to be provided to any liability occurring on account of a ship crashing or colliding and on account of any other induced attacks. )rei6ht Insurance8 Ereight insurance offers and provides protection to merchant vessels< corporations hich stand a chance of losing money in the ith an form of freight in case the cargo is lost due to the ship meeting losing money because of a fe occurring. /"4 T+P&( O) MARIN& IN( RANC& POLICI&(
29

ell. &any

transits, particularly international ones require t o or more types of transport

accident. This type of marine insurance solves the problem of companies unprecedented events and accidents

!" Time po0icy A time policy is taken for definite period of time, usually not exceeding )6 months say from 5anuary ), )*F) to (ecember -), )*F). This policy is most suitable for hull insurance. ," 'oya6e po0icy ?here the subDect matter is insured for a specific voyage, say from .ate ay of India to %ort in =rilanka it is named as voyage policy. /" Mi5ed po0icy This policy is the combination of time and voyage policy. It, therefore, covers the risks for both particular voyage and for a stated period of time. 2" )0oatin6 po0icy Eloating policy is taken for a relatively large sum by the regular suppliers of goods. It covers several shipments hich are declared after ards along ith other particulars. This policy is most situated to exporter in order to avoid trouble of taking out a separate policy for every shipment. 4" 'a0ued po0icy 1nder its terms the agreed value of the subDect matter of insurance is mentioned in the policy itself. In case of cargo this value means the cost of goods plus freight and shipping charges plus )7> to )@> margin for anticipated profit. The said value may be more than the actual value of goods. :" n1a0ued po0icy ;Open Po0icy<
30

?here the value of the subDect matter of insurance is not declared but left to be ascertained and proved later it is called unvalued policy. =" $ui0der>s ris- po0icy This policy is issued for more than one year. This covers the risk of damage to vessels from the time its construction commences until its trail is completed. ?" $0an-et po0icy 1nder the condition of the blanket policy the maximum limit of the required amount of protection is estimated hich is purchased in lump sum. The amount of premium is usually paid in advance. This policy describes the nature of goods insured, specific route, ports and places of the voyages and covers all the risk accordingly. @" Port ris- po0icy This policy covers all the risk of a vessel hile it is standing at a port for particular period of time. !#" Wa6er po0icy ?here the assured has no insurable interest in the subDect matter of insurance that is kno n as ager policy. As this policy has no legal effect so it cannot be taken to a court of la . If under rite refuses to accept the claim the policy holder cannot take any legal action against him. It is, therefore, also called as gambling policy.

!!" (pecia0 ha7ards po0icy

31

This policy covers special risks incident to piracy and ar. It provides protection to insured under agreement against sei+ure, capture, detention and other ar risks. !," Composite po0icy This type of policy is purchased from more than one under any motive of fraud then insured separately in case of loss. !/" $0oc- po0icy This policy is particularly purchased to gold diggers. It covers all the risks of damage to gold from the time of its recovery to its distinction. This type of policy has been introduced in Africa and is very popular in the mine fields of gold. riters. If there is no riter

ill be indemnified by each under

/": IMPORTANT CLA (&( IN MARIN& POLIC+

i"

Lot of Not Lot9This clause protects the insured, goods hich are on a ship

hich in good faith insures ere

hich has left a foreign port, in case they

destroyed unkno n to him, before he affected the policy. In this case both the inDured as ell as the insurer ought not to have been a are of the loss of the goods or the steamer at the time of the insurance. If the insured kne of the loss and did not inform the insurer at the time of

effecting insurance the policy ould be void.

ii"

Name of the (hip and Master99ere is given the name of the ship and the master for the voyage hich is insured.
32

iii"

'a0uation C0ause9This clause states the actual value of the goods as agreed upon bet een the under riter and the insured in the case of a valued policy, and in the ca se of an open policy a bland is left after the ords, !and shall be valued at..!

i1"

The Parties9All persons competent to contract may be parties to policy of insurance. A policy may be under ritten or undertaken either by an insurance company or an individual under riter as is the case in Jngland. The expression for and in the name of all and every other person or persons, etc.! protects all persons the policy or risk. ho has insurable interest at the time of effecting ho acquired insurable interest during the continuation of the ith $loyd!s

1"

Description of the 'oya6e or Duration of the Ris-9 This clause begins ith the orks !at and from! and in the blank left in the policy is inserted the description of the voyage intended to be insured. The risk begins from the place at hich the steamer is at the time of insurance and ends hen she arrives at the port of destination.

1i"

(ea Peri0s Insured A6ainstA or the Peri0s of the (ea9 These perils include in detail all the perils against hich the insured is protected. This clause in $loyd!s embraces almost all the sea perils including !periods of the seas, menAofA ar, fire, pirates, rovers, thieves, Dettisons, arrests restraints and detention of all kings, princes and people, and mariners and of all other perils, losses, and misfortunes that have or shall come to the hurt, detriment, or damage of the sail goods or merchandise and the ship.!

33

1ii"

Receipt of Premium and the Rate Char6e9 The receipt of premium and the rate charged are stated in this clause. %remium is the consideration paid by the insured to the under riter for undertaking to indemnify him against the loss as per the terms of the policy. The form of $loyd!s policy clearly uses the under riter, at the time the policy ords, !confessing ourselves

paid the consideration due...!, as if the premium had already been paid to the as affected. In practice, ho ever, the premium in $ondon on $loyd!s is not paid by the broker at the time of affecting the policy. The practice there is to pass the amount in account bet een the insurance broker and the under riter.
1iii"

(ea Peri0s Insured A6ainstA or the Peri0s of the (ea9 These perils include in detail all the perils against hich the insured is protected. This clause in $lyod!s embraces almost all the sea perils including !perils of the seas, menA ofA ar, fire, pirates, rovers, thieves, Dettisons, arrests, restraints and detention of all kings, princes and people, barratry of masters and mariners and of all other perils, losses, and misfortunes that have or shall come to the hurt, detriment, or damage of the said goods or merchandise and the ship.!

i5"

Memorandum9The commodities insurance comprise various articles

hich are the subDect matter of marine hich are liable to undergo deterioration

or damage to a greater or lesser extent according to their peculiar nature. =ome of these commodities may even perish or be damaged through detention or delay. To avoid, therefore, claims arising through the inherent vice in the nature of such commodities, almost every policy of insurance includes a clause or memorandum; in the case of the $loyd!s policy it is called the E.%.A. clause.
34

1nder the E.%.A. clause the under riter is liable for total loss but is not liable for particular average or partial loss. %artial loss is agreed to be paid if it exceeds three per cent in certain cases, and five per cent in others.
5"

Wai1er C0ause9This is in fact continuation of the !sue and labour! clause because it lays do n that !no acts of the assurer or assured in recovering, saving or preserving the property insured, shall be considered as a aiver or acceptance of abandonment. !This clause is no adays found in almost all public policies of $loyds!s.

5i"

(ue and La.our C0ause91nder this clause it is specifically provided that it shall be la ful to the assured, his factors, agents and assigns to do all in their po er to defend the property insured in case of damage or loss; and in return in the under riter agrees that the insured!s rights to his insurance claim are not in any ay preDudiced; and that all the expense thought la ful in such preDudiced; and that all the expenses though la ful in such attempt shall, save costs against the damage insured, be made good by the under riter.

5ii"

Imp0ies Warranties 0esides the actual conditions the follo ing are implied by la CA a. =ea orthinessAi.e. at the time of insurance the ship is en every respect fit for the voyage. b. $egality of :oyageAi.e. it is for a legal purpose and is not, for example, a smuggling adventure. c. 3onAdeviationAi.e. the ship here a voyage is bet een t o specified ports that

ill take the usual route and not deviate from it except

through unavoidable necessity.

35

5iii"

Causa Pro5ima The literal meaning of this $atin expression is '%roximate /ause.! This arises hen a property is insured at sea and more than one cause operates to hich case the proximate cause ought to be considered. as damaged by seaA ater hich trickled as the as held that the proximate cause here the cargo bring about loss, in Thus, in a case

from a pipe gna ed by rats, it seaA ater, and the insured cause.
5i1"

as entitled to damages, the rat!s beings remote

$ottomry $ond ?hen the master of a ship is in urgent need of money on the o ner!s credit, or is unable to communicate hich he cannot raise ith the o ner, he has hich he

the po er to give a bond kno n as the 'bottomry bond,! by pledges the ship as a security to the person advancing money.

The peculiarity of this bond is that the capital and interest on the loan is payable only if the ship reaches its destination if therefore, after this bond is given, the master proceeds its destination. If, therefore, after this bond is given, the master proceeds ith the voyage and has, at omen other port, to raise further money for urgent repairs, for hich he gives a second bottomry bond to some other person, this second part acquires a prior right over that of the lender on the first bond.

36

/"= $&N&)IT( O) MARIN& IN( RANC& The cover, automatic and optional extensions bring many benefits to your extensive insurance cover options. Co1er inc0udes8

=udden accidental physical loss or damage. Agreed value single sum insured on the vessel hich includes, here applicable, spars, sails, machinery, tender, outboards, trailer, equipment and other accessories that ould normally be sold ith the craft.

%rovision to insure fishing gear kept permanently aboard vessels on &oored or 0erthed craft policies.

3avigation limits up to 677 nautical miles from 3orth and =outh Islands of 3e Nealand including transportation and storage on land.

Automatic e5tensions inc0ude8

Jmergency to ing costs follo ing a breakdo n up to I6,777 per year. /re rescue costs up to I)7,777. Reimbursement of temporary accommodation costs up to I),777 follo ing an accident to your vessel.

%ersonal effects, your o n or guests

hilst aboard your vessel and not

other ise insured. Eor moored launches and yachts up to I),777 for fishing gear and I@,777 in total and for trailer craft I),777.

37

Reimbursement of costs up to I),777 for replenishing, refilling or replacing fire extinguishers and4or safety flares used during an incident giving rise to an admitted claim.

Reimbursement of costs, up to 6@> of the sum insured, incurred in preventing or attempting to prevent loss or damage.

&edical expenses up to I6,777 incurred as a result of an accident to any person hile in, upon boarding or leaving your vessel.

Items purchased for the vessel during any one period of insurance automatically covered up to I6@,777 in respect of moored vessels, and I@777 for trailer craft.

$ump sum payment of I)7,777 in total for the accidental death of the insured4s as a result of bodily inDury hilst aboard the vessel.

$egal liability arising from the o nership or use of the vessel I@,777,777. %unitive or exemplary damages I6@7,777. .eneral damages for mental inDury I6@7,777. ?ith our prior approval legal costs up to I)7,777 should you or your vessel be involved or implicated in a maritime accident &=A, TAI/ or /oroner!s inquiry. hich is the subDect of a

Optiona0 e5tensions inc0ude8

Eull racing cover for yachts. %artnership deaths by accident coverAspecifically for syndicates. 0lue ater off shore facility.
38

Chapter I' N&W INDIA A(( RANC& COMPAN+ LIMIT&D

2"# The New India Assurance Co" Ltd", based in &umbai, is one of the five public sector insurance companies in India. It is the 'largest general insurance company of India on the basis of gross premium collection inclusive of foreign operations'. It as founded by (orab Tata in )*)*, and nationali+ed in )*,-.
39

%reviously it as a subsidiary of the .eneral Insurance /orporation of India ".I/#. 0ut hen .I/ became a reinsurance company as per the IR(A Act )***, its four India Assurance, 1nited India Insurance, primary insurance subsidiaries 3e

2riental Insurance and 3ational Insurance got autonomy. 3e India Assurance operates both in India and foreign countries. In the recent ith some of the leading public sector India

past it has succeeded in forging tieAups

banks in India such as =tate 0ank of India, /entral 0ank of India, /orporation 0ank and 1nited ?estern 0ank to increase its distribution net ork. 3e Assurance is a .overnment of India undertaking. 3e nationali+ed in )*,-. The 3e in many countries abroad. 3e India Assurance has established itself in the Indian as ell as global insurance industry and has gained significant recognition o ing to numerous achievementsC

India Assurance became

India Assurance /ompany $imited is one of the

leading global insurance groups and has offices and branches throughout India and

$argest 3onA$ife insurer in AfroAAsia excluding 5apan Eirst Indian nonAlife company to cross Rs. F66@.@) crores .ross %remium 2verAseas presence in countries like 5apan, 1.G, &iddle Jast, EiDi and Australia

$argest number of offices in India and Abroad Trained and technically qualified staff )7F@ fully computeri+ed offices across India.

'AA' "Jxcellent# rating by A. &. 0est H /o "Jurope#, first domestic company to be rated by an International Rating Agency.

40

Eirst company to set up an Aviation Insurance (epartment in )*B8. Eirst company to handle the 9ull Insurance requirements of the Indian =hipping Eleet.

Eirst company to establish its o n Training =chool. Eirst company to introduce the concept of !&odel 2ffice Training!. Eirst company to create department in Jngineering insurance. %ioneer in =atellite insurance.

2"! O))IC&( The company ith its corporate office in &umbai has about 6F regional offices,

-*, divisional offices, @FF branches, 6, direct agent branches and 6- extension counters in the year 67))A67)6. The number of regional offices of the company in the year 67)) stood at 6F, ith numerous other offices do n the hierarchy of divisional offices, branch offices, direct agents branches, micro offices. /entrali+ed claim processing offices called claims hubs are operated from 6* locations. Its overseas offices for the year 67))A67)6 consisted of )* branches, seven agencies, four associate companies and three subsidiary companies spread over 6countries. 2", T*& PION&&R(

Eirst company to set up an Aviation Insurance (epartment in )*B8. Eirst company to handle the 9ull Insurance requirements of the Indian =hipping Eleet.
41

Eirst company to establish its o n Training =chool. Eirst company to introduce the concept of !&odel 2ffice Training!. Eirst company to create department in Jngineering insurance. %ioneer in =atellite insurance.

2"/ T*& N&W INDIA A(( RANC& 3&N&RAL IN( RANC& PROD CT( *ea0th P0ans 9ospitali+ation burn a hole in our pocket and alter our quality of life by imposing financial restrictions 3e India Assurance health plans guarantee peace of mind for the insured against financial perils caused due to sudden hospitali+ationC

%ravasi 0haratiya 0ima MoDana %olicy %ersonal Accident %olicy Rasta Apatti Gavach "Road =afety Insurance#

Medic0aim Po0icy

%anata Medic0aim po0icyC The 3e

India health insurance policy covers hen hospitali+ation is

pre and post hospitali+ation expenses but in the case

for more than 6B hours. The policy also provides medical expenses to ards day care treatments and ambulance charges are also met by the policy. %reA existing diseases are covered after four continuous and claim free rene als ith the company.

42

)ami0y )0oater Medic0aim po0icyC This is the policy specially designed to cover family under single premium. It covers individual<s spouse and children under the same policy. The basic premium charged is per the highest aged member and loadings are charged for covering spouse and children. This policy provides pre and post hospitali+ation expenses.

(enior citi7ens Medic0aim po0icyC This policy is meant for senior citi+ens above the age of 87 years till F7 years. %roposers must undergo a prescribed preAacceptance health check at their o n cost to identify preAexisting diseases. The health check is aived if the proposer is already having &ediclaim insurance in continuity ith our /ompany.

Car Insurance P0ans 3e India Assurance plans provide you ith a comprehensive motor policy that

lets you take care of yourself rather than a car i case of an accident. The motor insurance plan provided by the company covers scooters, motorcycles, private cars and all types of commercial vehicles. The policy is available under t o variantsA liability only policy and package policy. $iability only policy covers third party liability for bodily inDury, death and property damage, personal accident cover for driver is also included under the liability variant hile package policy covers loss or damage to the vehicle plus everything covered under liability policy. The package policy also covers loss arising from fire, explosion, earthquake, flood, riot, strike and any damage from terrorist activity. :arious add on covers like damage or loss to electrical and other accessories, legal liability to employees can be added by paying extra premium.
43

Motor Po0icy

Tra1e0 Insurance P0an 3e India Assurance %olicies become a great companion for you on your holidays, business trips or visits and help in safeguarding the dilemma of lost baggage on the ay.

O1erseas Medic0aim po0icyC The 3e

India Assurance 2verseas travel

insurance is specially meant for travelers travelling frequently outside India. The main feature of this plan is that the premium is paid in local currency hile claims are settled foreign currency. It covers medical expenses incurred by insured outside India as a direct result of the bodily inDury caused or sickness or disease contracted during the travel. Additional benefits like loss of baggage, personal accident, loss of passport and personal liability are extended ith the payment of extra premium.

(uhana (afar po0icyC The 3e

India Assurance =uhana =afar policy is

designed particularly for domestic travelers. The policy covers any mode of transport like rail, road, air, ater including o n vehicle. This policy can be availed for a shorter period for as short as 87 days. The policy covers the risk of personal accident, loss or damage to the baggage of a family consisting of spouse and dependent children. The cover operates from

44

declared place of departure and terminates on schedule date of return or on actual return, hichever may happen earlier.

Marine Insurance P0ans 3e India Assurance provides &arine Insurance %olicy as ell as the shipping

/argo policy

hich helps to recover the damage to the ships and the goods during

the travel from origin to the destination. This policy covers goods, freight and other interests against loss or damage to goods hilst being transported by rail, road, sea and4or air.

(ifferent policies are available depending on the type of coverage required ranging from an A$$ RI=G cover to a restricted EIRJ RI=G 23$M cover. This policy is freely assignable and is basically an agreed value policy.

*ome Insurance P0ans 3e India Assurance %olicies help to safeguard your home and give you

comprehensive coverage against many perils.

The New India Assurance *ouseho0derBs po0icy C This policy is a package policy specially designed to meet the insurance requirements of a house holder. The coverage of this policy is very large. It covers for any damage
45

due to fire, explosion, lightening and natural calamities like floods, earthquakes, landslides, hurricane, tornado, storm etc. This policy covers hole building as ell as its contents. This policy covers the contents of the home from loss suffered from burglary and houseAbreaking. 5e elry, glass and domestic appliances are covered from any loss or damage from any kind of accident. Jlectrical appliances damage is also covered under this policy. The 3e India Assurance house holder<s policy covers the loss or damage of pedal cycles due to fire and allied perils, burglary, housebreaking, accidental external means and third party personal inDury or third party property damage. It also covers insured<s legal liability for bodily inDury or loss of or damage to property of third party limited to amount specified in the schedule and orkmen!s compensation liability to domestic servants engaged in insured!s premises. It is advisable to compare all 3e suits you the most. Persona0 Accident P0an The 3e India Assurance personal accident plans are one of the comprehensive India Assurance India Assurance .eneral insurance plans from

other .eneral insurance companies in India to choose the best insurance plan that

plans available in the market. 2ne can make online comparison bet een The 3e India Assurance personal accident premium and The 3e personal accident quotes to understand the policy.

Persona0 Accident po0icyC This is a broader coverage plan

hich

compensates an insured or its nominees in the event of death and any kind of permanent or temporary disability. The policy provides compensation in case of any bodily inDury or death to the insured, directly and solely as a
46

result of accident by external, visible and violent means. The policy does not compensate in the case of death due to any preAexisting illnesses. 1nder this policy, family floater and group insurance policies are also available. There is a special student plan under this policy as ell.

Rasta Apatti Ca1ach ;Road safety insurance<C This insurance policy has been designed to cater to the specific need of an individual ho meets ith an accident ith a motor vehicle on road and sustains inDuries hich requires hospitali+ation for treatment. The policy also has provision for compensation for death and permanent disability. The policy has t o sections. 2ne of hich provides compensation payment in case of personal accident and other is the compensation by providing medical expenses in case of any hospitali+ation.

2"2 )INANCIAL RATIN3 Eor the sixth consecutive year, the /ompany has been rated as 'AA' "Jxcellent# by &4s. A.&. 0est Jurope $td. The rating reflects /ompany!s excellent risk adDusted capitali+ation, prospective improvement in under riting performance and its leading business profile in the direct insurance market in India. A partially offA setting factor is the /ompany!s reliance on investment income hich counter ill balances under riting losses. 0ut the outlook is stable. A.&. 0est believes the /ompany!s risk adDusted capitali+ation is excellent and anticipates that it expects that there remain sufficient to absorb the likely gro th in the net premium. Eurther it also ill be a reduction in the combined ratio in the years to come.

47

The /ompany is likely to maintain its leading business position as the largest direct insurer in India, despite increased competition from private players.

2"4 T*& N&W INDIA A(( RANC& P&R)ORMANC& 3e India Assurance /ompany is the largest nonAlife insurer in India. The

financial strength of the /ompany is reflected from the follo ing figuresCA

48

=tatistical data on performance of 3J? I3(IA A==1RA3/J /2&%A3M $T( ")**FA67)6#

49

2": N&W INDIA A(( RANC& MARIN& CAR3O POLIC+

50

This policy covers goods, freight and other interests against loss or damage to goods hilst being transported by rail, road, sea and4or air. *i6h0i6hts

This policy covers goods, freight and other interests against loss or damage to goods hilst being transported by rail, road, sea and4or air. (ifferent policies are available depending on the type of coverage required ranging from an A$$ RI=G cover to a restricted EIRJ RI=G 23$M cover.

This policy is freely assignable and is basically an agreed value policy.

Premium D C0aims The sum insured or value of the policy cost. The follo ing steps should be taken in event of a loss or damage to goods insuredC ). Take immediate steps to minimi+e loss. 6. Inform nearest office of the insurance company or claim settling agent mentioned on the policy. -. In case of damage to goods survey or port survey. B. $odge monetary claim ith carrier ithin stipulated time period. @. =ubmit duly assigned insurance policy4certificate along ith the original hilst on ship or port, arrange for Doint ship ould depend upon the type of contract.

1sually, in addition to the contract value )74)@> is added to take care of incidental

invoice and other documents required to substantiate the claim such as C

51

). 0ill of $ading 4 A?04.R 6. %acking list -. /opies of correspondence exchanged ith carriers. B. /opy of notice served on carriers along ith ackno ledgment4receipt. @. =hortage4(amage /ertificate issued by carriers. 8. =urvey fees are to be paid to the surveyor appointed by the insurance company. These fees other ise admissible. ill be reimbursed along ith the claim if the claim is

2"= N&W INDIA A(( RANC& MARIN& * LL POLIC+ It covers any loss or damage to ships, tankers, bulk carriers, smaller vessels, fishing boats and sailing vessels. The =hipAo ners, charterers, =hipbuilders, bankers, financiers of =hips or vessels policy. Po0icy Co1ers

ho have Insurable interest can take the

All types of 2ceangoing vessels All type of /oastal4Inland vessels Mard and pleasure /rafts %ort /rafts =hipbuildingA construction of vessel
52

=hip Repairers! $iabilities /harterers $iabilities 0reaches of arranties 4 voyage cover EreightA at ARisks insurance for voyages (redgers Eishing vessels 4 Tra lers =ailing :essels 5etties " ith or etc. ithout cranes#, fixed pontoons4%ontoons 5etties, harves

=hip breaking

2"="! P&RIL( E RI(C( ;A< The po0icy co1ers peri0s of the seasA ri1ersA 0a-es or other na1i6a.0e waters 0ossEdama6e to the property insured caused .y8

Eire, explosion =tranding, sinking etc. 2verturning, derailment " of land conveyance # :iolent theft by persons outside the vessel. /ollision .eneral average sacrifice, sacrifice, salvage charges
53

5ettisons %iracy 0reakdo n of or accident to nuclear installations or reactors /ontact ith aircraft or similar obDects, or obDects falling there from, land

conveyance, dock or harbour equipment or installation.

Jarthquake volcanic eruption or lightning. /re 3egligence.

&5c0usions The policy does not cover loss4 damage due toC

(eliberate damage4destruction of the vessel by rongful act of any person 1se of any eapon of ar employing atomic 4 nuclear fission and or fusion. Radioactive /ontamination, /hemical, 0iochemical, 0iological,

Jlectromagnetic ?eapons.

Insolvency or financial default of the vessel o ner 4operators 4charterers ?ar 4 civil ar, =trike, Riot or /ivil /ommotion Any terrorist or person4s acting ith political motive

;$< COMPR&*&N(I'& PORT PACCA3& POLICI&(8 Co1er can .e purchased .y89

%ort Authorities
54

%ort 4 Terminal operators %rivate 5etty 2 ners

(cope of Comprehensi1e co1ers89

%hysical (amage Third %arty $iability 0usiness Interruption Terrorism ?reck Removal A 9 H & /over for :essels

&5c0usions89

/onfiscation, requisition, detention 0locking of se ers, drains ?ear H Tear, deterioration Jrror in design, orkmanship &echanical 4 Jlectrical 0reakdo n

;C< Oi0 D &ner6y Ris- Insurance Po0icies8

/over can be purchased by A 2il and Jnergy Industries. =cope of /omprehensive covers A
55

o o o

2ffshore 4 2nshore constructions 4 Jrections " 0uilders Risks # %roduction 4 2peration /over A ?ell head platform4 process platform. Jxploratory (rilling "2ffshore A 5ack 1p Rigs, (rilling Rigs, =emi =ubmersibles etc. 2nshoreA Eixed $and rigs, &obile $and Rigs, ?orkAover $and rigs#

o o o

=eismic =urvey =ingle 0uoy &ooring " =0& # 1nder ater pipeline 4 /able Insurance

C0aim Intimation and (teps to .e ta-en .y Owners8 In the event of casualty likely to give rise to a claim

Immediate notice to policy issuing office. .iving brief details as to name of vessel, place of occurrence, date H time of casualty, circumstances leading to incident.

=eek appointment of surveyor to inspect and assess loss. In case of theft please notify police. In case of fire assistance of fire brigade to extinguish fire. Appointment of adDuster in case of 2ceangoing :essels here necessary. All steps to minimi+e loss as prudent uninsured.

Documents &ssentia08
56

/ertified copy of note of protest by master &arine casualty form issued by &.&.(. Insured!s report on occurrence. =urvey Report 2riginal Repair 0ill, cash memo, Invoices ?eather Report by &eteorological (ept. Affidavits filed by rescue vessels /ertificate of survey for inland vessels Registry certificate Eree board certificate $oad line certificate " here applicable # =tatus 4 copies of &andatory certificates 3otari+ed statements of master and chief engineer of the vessel. $og 0ook extracts "Jngine H (eck # /re list ith details of competency certificates. /opy of /laim bill ith supporting documents.

Chapter ' )INDIN3( D ( 33&(TION(

57

4"# The complete findings and required suggestions are finally given in this chapter for the purpose of improving the performance of 3e future. 4"! )INDIN3( ). Introduction chapter explained the overvie of the proDect report; it contains the obDectives, hypothesis H the limitations of the study. It also has the revie s given by certain authors regarding the general insurance sector and the marine insurance. 6. The second chapter contains about the introduction to insurance, its principles, and various types of insurance. -. The third chapter is the analysis chapter hich contains detailed information India Assurance /ompany policies in the $imited in providing &arine insurance policies H also framing ne

about marine cargo insurance, the marine insurance products, its different policies H important clauses in marine insurance. B. The fourth chapter is also an analysis chapter hich states about the 3e

India Assurance /ompany $td, the products offered by the company, H different types of marine insurance and services offered by the company and the premiums, claims and eligibility regarding the marine insurance policies. @. The fifth chapter is the final chapter suggestions for the proDect. hich includes required findings H

58

8. (uring the survey it

as observed that maDor source of information for

consumer are television and ne spaper and least preference are given to maga+ines, agents and friends. ,. Attractive schemes and brand image are the most important factor that influences the buying behavior of the consumers.

4", ( 33&(TION( 2n the basis of the collected data and the analysis, some suggestions can be made to the 3e India Assurance /o. $td hich ill be helpful to them in improving their services operational and financial performance. These suggestions have been discussed as follo sC

). Jven though most of the policy holders are satisfied ith policies, plans they have but some ne attractive insurance plans should be introduce to bind them not to s itch over to other companies insurance plans.
6. The company should find out the no. of people

ho are not having any of

the &arine insurance plans through an intensive market research and motivate them to get insured.
-. $everaging technology to service customers quickly, efficiently and

conveniently.

59

B. (eveloping

and implementing superior risk management and

investment strategies to offer sustainable and stable returns to our policyholders. @. 3e India Assurance /o. $td should target each and every class of the

society hile providing the products.

8.

/ompany should provide full information to the customers before targeting so they can take interest in the &arine Insurance policy they have opted for. hich

60

CONCL (ION
After completing the proDect it is concluded that 3e India assurance /o. $td has

develop its various plans and policies, flexible in nature, according to the requirements of its targeted market or customers and is thus beneficial to its customers in various ays. The most important benefit it provides to its customers is that it is a government o ned company. This lead to increase in the satisfaction level of its customer that is hy 3e India assurance /o. $td has6F regional offices, -*, divisional offices, @FF branches, 6, direct agent branches and 6extension counters in the year 67))A67)6. Therefore it is not only beneficial but better than other insurance companies not only regarding its product but also its services. Erom the discussion it is evident that general insurance industry expanded tremendously from )*,- on ards in terms of number of offices, number of agents, ne business policies, premium income etc. Eurther, many ne products "&arine ere provided insurance, motor insurance, &ediclaim policy, etc.# and the insured policy provided by the 3e

by the insurers to suit the requirements of various customers. The marine insurance India Assurance /ompany $td act as a tool for improving the performance of the company for providing the marine insurance policy to its customers satisfying their most of the needs.

61

$I$LIO3RAP*+

$OOC(
.eneral Insurance Mear 0ook, (r.Rakesh Agar al, 5uly 67)) Jlements of 0anking H Insurance, 6778, 5yotsana =ethi &arine InsuranceC its %rinciples H %ractices volume ), ?illiam ?inter, 677@ Innovations in 0anking H insurance, Romeo =. &ascarenhas

W&$(IT&( .ne india.co.in . ikipedia.org .insuremarine.com .myinsuranceclub.com

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.allinsuranceinfo.com

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