The deductible is an excess and only the balance amount is payable. If the amount of the claim is less than the deductible, nothing is payable. A claim arises on the policy only where the aggregate of all claims arising out of each separate accident or occurrence exceeds the amount of the deductible. The deductible clause applies the policy deductible to all partial losses covered by the policy. Thus it is applied to: i. Particular Average. ii. General Average sacrifice and contribution. iii. Salvage awards and contribution to salvage awards. iv. Sue and Labour. v. Expenses incurred for services in the nature of salvage. vi. Claims under the collision liability clause including costs in relation thereto. It is however to be noted that deductible is applied only once in respect of each accident or occurrence, so any loss in relation to the above is aggregated for the purpose of applying the deductible. Deductible does not apply to: i. Total Loss and/or Constructive Total Loss. ii. An associated claim made under the Sue and Labour Clause arising from the same casualty, this means that where an expense is incurred under the Sue and Labor clause, but a total loss results despite all attempts to save he ship, the deductible is not applied to the Sue and Labour charges. Expenses of sighting the bottom after stranding shall be paid even if no damage is found. iii. The total of heavy weather damages arising during the voyage between two consecutive ports is treated as being due to one accident. Where a policy during a period of heavy weather, and a new policy applies, the deductible is assessed in proportion to the days of heavy weather applying to the respective policies during the transit. Heavy weather is deemed to include contact with the floating ice. iv. Subject to Subrogation up to the amount of claim paid.

This insurance covers the Vessel’s proportion of salvage, salvage charges and/or general average, reduced in respect of any under-insurance, but in case of general average sacrifice of the Vessel the Assured may recover in respect of the whole loss without first enforcing their right of contribution from other parties. Adjustment to be according to the law and practice obtaining at the place where the adventure ends, as if the contract of affreightment contained no special terms upon the subject; but where the contract of affreightment so provides the adjustment shall be according to be York-Antwerp Rules. When the Vessel sails in ballast, not under charter, the provisions of the York-Antwerp Rules, 1974(excluding Rules XX and XXI) shall be applicable, and the voyage for this purpose shall be deemed to continue from the port or place of departure until the arrival of the Vessel at the first port or place thereafter other than a port or place of refuge or a port or place of call for bunkering only. If at any such intermediate port or place there is an abandonment of the adventure originally contemplated the voyage shall thereupon be deemed to be terminated. No claim under this Clause shall in any case be allowed where the loss was not incurred to avoid or in connection with the avoidance of a peril insured against.

A number of factors influence the rating of ships. The marine hull insurance business in India is detariffed and, hence, market-driven. The main factors that are taken into consideration in the underwriting and rating of hull risks are: Type and Physical Parameters of Vessels • Tanker, Dry cargo Vessel, Fishing Vessel, Dredger, etc. • Construction such as steel built, wooden construction, etc. • Age • Tonnage (GRT & DWT)/Engine power (BHP) • Method of Propulsion – single engine, double engine, dumb, etc. • Single bottom, double bottom, etc. SUM INSURED Indian Law permits Quarterly Installment facility to marine hull policies @ 25% of annual premium for time policies of minimum 12 month validity. Similarly, Builder’s risk policies are also eligible for installment facility, but only when the period of construction is 12 months or over and subject to the provisions of Premium Payment Regulations which, inter-alia, stipulates that the First installment should be 5% more than the rest. RATING Trade of the Vessel • Operation carried on – Fishing, Towing, Dredging, etc. • Nature of cargo carried – Dry/bulk, crude, acid, etc. • Trading Routes and Navigational Limits, weather condition, etc. Trading Warranty is introduced in the policy for insurance of ships clearly defining the geographical area in which the ship is permitted to navigate. In the absence of such warranty, the ship is at liberty to navigate anywhere worldwide increasing the risk exposure and degree of hazard. The Institute Warranty (IWL) dated 20.7.87 is normally used for all ocean-going ships. IWL breaches can be covered at additional premium paid in advance. Ownership • Fleet Characteristics, Size and Management • Fleet Claims Experience Classification: Seaworthiness, quality of maintenance, etc. Flag and Registry of the Vessel: Flag of Convenience (FOC) or not. Condition of Insurance: TLO or wider cover, P&I cover, etc. Sum Insured vis-à-vis Valuation of the Vessel. [2] GRT or Gross Registered Tonnage of a ship refers to the cubic capacity of all enclosed spaces. NRT or Net Registered Tonnage is the tonnage is obtained by deducting from the gross tonnage spaces for crew, ballast tank, chain space, workshop, etc. This parameter is used for rating cargo carrying ships. [3] BHP or Brake Horse Power refers to the power of the propulsion machinery and is used rating tugs.

Marine Liabilities : This is a specialized branch of marine insurance dealing with liabilities of various interested associated with shipping industry and maritime trade. Some of the common policies under this class of insurance are Charterers’ Liability, Stevedores Liability, Terminal Operators’ Liability and Freight Forwarders Liability.

Including the risks of theft, pilferage and/or non-delivery, fresh water and rain water damage, hooks, oils, mud, acid and other extraneous substances or heating and sweating and damage by other cargo. This clause, containing specific extraneous risks, is noised to extend the cover afforded by ICC (B) when required. Marine – cum – Erection All Risks Insurance (MCE) : Refer : “Engineering: Marine – cum – Erection All Risks Insurance (MCE).”

Marine Policy feature providing that no claims below a stated amount are to be paid by the Insurers but if the claims are above that amount the entire amount will be paid. This clause discourages the submission of small claims that cost more to process than the actual settlement amount.

Issued to provide automatic and continuous Insurance protection to a regular exporter/importer engaged in international trade. It is not a Policy and is therefore not stamped. It is an agreement, building in honors whereby the Insurer undertakes to insure all shipments declared by the insured and which come within the scope of the open cove. Once arranged, the insured is guaranteed protection on the agreed basis for all shipments falling within its provision, subject to declaration of full shipping details of each shipment.

Groups of companies acting in common to insure certain ocean marine classes. Also, a term used to describe groups that make inspections and surveys and institute standards for the construction of vessels.