An arranged settlement on a hull policy where there is no actual or constructive total loss but where repair of the vessel is impracticable.
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An agreement between a hull underwriter and assured ship-owner, whereby the underwriter is prepared to pay a compromised settlement on a total loss basis because, although the estimated cost of repairs does not justify a constructive total loss, repairing the ship would be an uneconomical proposition in view of its market value and the high cost of repairing the damage. The settlement usually, allows the assured to retain the wreck.