MARINE CARGO INSURANCE

MARINE TRANSIT INSURANCE

• OLDEST INSURANCE
• ORIGINATED IN 16TH CENTURY OVER A
CUP OF COFFEE
• TRADERS IN VENICE DECIDED TO SHARE
EACH OTHER’S LOSSES AND GOOD
FORTUNE
 WHAT IT COVERS
 TRANSIT OF GOODS BY
 OCEAN VESSEL
 FERRY
 OCEAN BARGE
 INLAND BARGE
 TRUCK
 VAN RAIL
 POST
 COURIER
 AIR
 MARINE INSURANCE
 Goods whilst in transit, are liable to loss or damage
through various perils.
Marine Insurance intends to protect the insured
against the risk of loss or damage to goods in
transit.
 Marine Cargo insurance has two basic features
(1) Imported to/exported from India and

(2) During pure inland transit in India.

 Marine insurance cover starts right from the movement

of goods/machinery/raw material leaves the
foreign/Indian manufacturer’s warehouse and remain
continuously in force during voyage, inland transit to
the factory site/warehouse
 Various types of covers are granted according to the
requirement of the client. Insurance of imports/exports
by ship/aircraft is subject to the following Institute
Clauses.

 Institute Cargo Clauses(A)

 Institute Cargo Clauses (B).

 Institute Cargo Clauses (C).

 Institute War Clauses (Cargo)

 Institute Strike Clauses(Cargo)

 STAMP DUTY

• Stamp Duty In Marine Insurance

- Sea Voyages 0.10 ps. Per 1500/- S.I subject to:

- Where rate charged is less than 0.125 (incl. War & SRCC)
then the stamp duty is 0.10 ps only
- For Transit by Rail/road/air stamp duty shall be 1/- for S.I
over Rs.5000 and 0.50 ps where S.I is less than Rs.5000/-.
 INSTITUTE CARGO CLAUSES ( C )

 Fire or Explosion

 Vessel or craft being stranded ,sunk, grounded or capsized.

 Overturning or derailment of land conveyance(Rail/lorry)

 Collision or contact of vessel/craft or conveyance with any

external objects.other than water
 Mishap at the time of discharge of cargo at Port of distress

 General Average

 Jettison
 INSTITUTE CARGO CLAUSES (B)

 All perils of ICC(c) and

 Earthquake,volcanic eruption and lightning

 washing overboard

 Entry of sea ,lake or river water into vessel,craft,hold,

 conveyance,container, leftvan or place of storage.

 Total loss of any package lost overboard or dropped

 whilst loading into or unloading from vessel or craft.

 INSTITUTE CARGO CLAUSES (A)

 All Risk
 Theft,pilferage and non-delivery of entire package.
 Fresh /Rain water damage
 Breakage,denting,scratching,
 Crushing, Crumping, chipping,chafing.
 Leakage
 Hooks,oil, acid, mud damage and damage by other
Cargo.
 Sweat,heat,Country damage
 Infestation, mould, mildew, rust.
 EXCLUSIONS UNDER ICC (A) ,( B) & (C)
 Loss damage,expense attributable to wilful misconduct
of insured.
 Ordinary leakage and breakage.

 Loss,damage,expense caused by
insufficient,unsuitable or defective packing or
preparation of goods
 Loss,damage,expense proximately caused by
delay,even if delay is caused by peril insured against.
e) Loss ,damage,expense caused by inherent vice.
f) Loss,damage, expense arising from insolvency or financial default of
owners, managers,charterers or operators of the vessel.
g) Nuclear weapons
h) Loss,damage,expense arising from
Eg I) Unseaworthiness of vessel or craft
ii) Unfitness of vessel ,craft,conveyance,container,lift van
I) War risks
j) Strikes,lockouts labour disturbances,riots,civil commotions or caused by
terrorists
k) Sentimental damage
l) Capture,seizure,arrest,restraint by Government bodies or under judicial
process.
m) Nationalization,requisition and confiscation.
n) Deliberate damage to or deliberate destruction of the subject matter
insured or any part thereof by wrongful act of any person or persons.
 DURATION OF COVER
 Attaches from the time the goods leave the warehouse or
place of storage named in the policy and continues during
ordinary course of transit and terminates either:
1) on delivery to the consignees or other final warehouse or place of
storage at the destination
2) on delivery to any other warehouse or place of storage whether
prior to or at the destination named,which
the assured elect to use either:
a) for storage other than in the ordinary course of transit
b) for allocation or distribution
3) On the expiry of 60 days after completion of discharge over-side of
the goods from the overseas vessel at the final port of discharge.
 SCOPE OF INLAND TRANSIT COVERS
 INLAND TRANSIT ( C) : Fire & lightning
 INLAND TRANSIT ( B) :
 I) Fire
ii) Lightning
iii) Breakage of Bridges
iv) Collision with or by the conveying vehicle
v) Overturning of the convey-ing vehicle
vi) Derailment or accidents of like nature to the
convey-ing railway wagon/motor vehicle.
 INLAND TRANSIT (A)

All perils of inland transit mentioned in (B) and

TPND, Breakage, leakage
Fresh/rain water damage
hook, oil, acid, mud damage
 EXCLUSIONS
a) Loss ,damage ,expenses attributable to wilful misconduct of the assured.
b) Ordinary (inevitable )loss
c) Insufficient/Unsuitable packing.
d) Delay
e) Inherent vice
f)War
g) Strike ,Riot or civil commotions
h) Loss, damage,expenses caused by Terrorist or any person acting from a
political motive
INCLUSIONS BY ADDITIONAL PREMIUM;
I) War Risk : 0.05%
II) War and SRCC 0.05% - For Export/Import Consignments
III) SRCC 0.0225% Domestic Transits
 DURATION OF COVER

 Under A & B

i)On delivery to the final warehouse at the

destination
ii) On expiry of 7 days after arrival of the Railway
Wagon/ Motor vehicle at the final destination
 Under Cover C

i)at the railway station at destination named in the

policy in respect of transit by rail
ii) at destination named in the policy in respect of
transit by road.
 MARINE CARGO CLAIMS DOCUMENTS
For considering a claim arising under a Cargo Policy,some
basic documents are required :
 INTIMATION OF CLAIM:
On receipt of intimation of loss, two things are of
immediate importance:
i) To ascertain whether a valid insurance policy is in
existence.
ii) Whether the statutory provisions for payment of
premium have been complied with ( 64VB)
 Appointment of Surveyors.
 Documentation to support claims:
 Original insurance policy/declaration under the open
policy duly endorsed by the insured.
 Original or a signed copy of sale invoice along with
packing list.
 Signed copy of Bill of Lading /Air consignment
note/postal receipt for sending by post.
 Copy of Bill of Entry(to check duty payment details).
 Letter of Subrogation duly stamped and executed (only
where recovery from carriers/third parties is possible.)
 In case of short-landing/non-delivery of complete
consignment:

i) Full set of original Bill of lading/Air Consignment

Note/Postal Receipt etc

ii) The original contract of affreightment should be

endorsed by the carrier confirming short-landing/non
delivery of the entire consignment by them or a
separate short-landing/non-delivery certificate

iii) An undertaking to be obtained from the claimant

that he would take delivery of the cargo if traced under
an insurance survey.
 CLAIM DOCUMENTS
 EVIDENCE OF INSURABLE INTEREST
 EVIDENCE OF SHIPMENT/ DESPATCH
 EVIDENCE OF LOSS OR DAMAGE
 EVIDENCE OF CHARGE INVOLVED
 EVIDENCE OF INSURED VALUE
 EVIDENCE OF PRESERVATION OF RIGHT OF RECOVERY
 GENERAL AVERAGE
 IN CASE OF PARTIAL LOSS OR DAMAGE:
a) Assessment report by sea/air/CTO carrier/postal authority.
b) Survey report of independent surveyor
c) Claim Form/claim bill.

Non-delivery(short landing or landed but missing)

a) Short-landing certificate from the port authorities.
b) Notice to the carrier or the Port authorities for the value of the lost
cargo.
c) A claim on the carriers or the port authorities should be
accompanied by:
i) Photocopy of short landing or landed but missing
certificate.
ii) Copy of Bill of Lading.
iii) Copy of Invoice.
IMPORTANT DATES
 Duty Insurance Policy

 Takes care of the loss of Duty already paid

 Insurance should be arranged before the vessel

arrives at the port of Destination