Under a contract of affreightment cargo is normally carried at the risk of the cargo owner who insures it. Where a collision between two ships damages the cargo, and both ships are to blame, the cargo owner will sue the third party ship owners who, by the law of some countries, can then recover part of the cargo claim from the carrier in whose ship it was carried. The Both to Blame Collision Clause in the contract of affreightment allows the ship-owner in these circumstances to obtain reimbursement from the cargo owner. The Both to Blame Collision Clause in a marine cargo policy indemnifies the cargo owner for such a payment.
Insurance Encyclopedia
Both to Blame Collision Clause
An Institute Cargo Clause indemnifying the cargo owner against the cost of reimbursing the shipowner who is compelled under foreign law to pay 50 per cent of a third party’s cargo loss to a third party shipowner following a collision in which both were blameworthy. Under US law the shipowners are held of equal blame and the cargo owner can recover in full from the third party shipowner who then recovers 50 per cent from the ship carrying the cargo. Provisions in the running down clause prevent the shipowner recovering in full under the hull policy, nor is the Protection and Indemnity Club liable, causing the shipowner to pass the risk to the cargo owner under the affreightment.
Bottom
The Vessel carrying the cargo that is the subject of the original Insurance.
Bottom limit
The maximum value at risk per shipment/sending/aircraft.
Bottom painting clause
An Institute Time/International Hull Clause relieving the insurer in all circumstances from the normal running costs of scraping or painting the vessel’s bottom.
Bottom Treatment, Marine Hull
The insurance does not pay for the cost of scraping or painting of the vessel’s bottom although damaged by a peril insured against. This is considered to be wear and tear and such expenses are regarded as essential and chargeable to running costs of shipping management.
Bottomry
A contract of Insurance by which a ship or its cargo is pledged as collateral for a loan required to support a maritime venture. In the early days of marine insurance, a ship-owner would borrow money on a mortgage on the ship, and the mortgage would provide that if the ship were lost, the borrower would not have to reply the loan. This was Bottomry, which thus combined money lending with insurance. When cargo instead of hull was involved it was called “respondentia.”
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UK: A loan raised by the ship’s master when other methods of raising money for a voyage have failed. The loan, secured on the vessel or vessel and cargo, is not repayable if the venture is lost. The term, now academic, illustrates an early form of risk transfer.
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When the master of a ship borrows money on the bottom of the ship, with the agreement that the ship will be forfeited to the creditor if the interest is not paid upon the ship’s return.
Bottomry (Property Insurance)
An insurance contract that accepts a ship or its cargo as collateral for a loan funding a maritime voyage. In the event the ship is lost at sea, the loan is cancelled and the borrower is not obligated to repay the lender.
Bouquet Of Treaties
A group of treaty arrangements offered by a Ceding Company as a package deal to reinsures. The Reinsurer is required to take an equal share in all the treaties (across the board), which may mean Writing some business which is normally not accepted, unbalanced or unattractive individually.
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Refer: “Reinsurance, Bouquet Of Treaties.”
Bouquet Treaty
Reinsurance treaty combining contracts from different classes of business; the package often includes both desirable and undesirable business.