Transcript Marine insurance - Pomorski fakultet u Splitu

Tomislav Skračić, MA
Undergraduate English
Course for
MARITIME MANAGERS
6th Semester
Essential reading:
●
●
T. Skračić, Waypoint – English Textbook for
Maritime Students, Pomorski fakultet, Split
2010, Units 29-33
T. Trappe & G. Tullis, Intelligent Business,
Longman 2005
MARINE INSURANCE Part 2
UNIT 33
Actual Total Loss and Constructive Total
Loss
 These two terms are used to differentiate the degree of proof
where a vessel or cargo has been lost. An Actual Total
Loss refers to the situation where the position is clear and a
Constructive Total Loss refers to the situation where a
loss is inferred. In practice, a Constructive Total Loss might
also be used to describe a loss where the cost of repair is not
economic; i.e. a "write-off". The different terms refer to the
difficulties of proving a loss where there might be no
evidence of such a loss, as in the case of the tanker Berge
Istra.
Unit 33
● In this respect, marine insurance differs from nonmarine insurance, where the insured is required to
prove his loss.
Unit 33
Average
The term “average" has two meanings
1) In marine insurance, in the case of a partial loss, or
emergency repairs to the vessel, average may be declared.
This covers situations, where, for example, a ship in a
storm might have to jettison certain cargo to protect the
ship and the remaining cargo. "General Average" requires
all cargo owners to contribute to compensate the losses
caused to those whose cargo has been lost or damaged.
"Particular Average" is levied on a group of cargo owners
and not all of the cargo owners.
Unit 33
Average
The term “average" has two meanings
2) In the situation where an insured has under-insured, i.e.
insured an item for less than it is worth, average will apply
to reduce the amount payable. There are different ways of
calculating average, but generally the same proportion of
under-insurance will be applied to any payout due.
Unit 33
Specialist policies
Various types of specialist policy exist, including:
 Newbuilding risks: This covers the risk of damage to the
hull whilst it is under construction.
 Yacht Insurance: Insurance of pleasure craft is generally
known as 'yacht insurance' and includes liability coverage.
Smaller vessels, such as yachts and fishing vessels, are
typically underwritten on a "binding authority" or "lineslip"
basis.
Unit 33
Specialist policies
Various types of specialist policy exist, including:
 War risks: Usual Hull insurance does not cover the risks of a
vessel sailing into a war zone. A typical example is the risk
to a tanker sailing in the Persian Gulf during the Gulf War.
War risks cover protects, at an additional premium, against
the danger of loss in a war zone. The war risks areas are
established by the London-based Joint War Committee,
which has recently included the Malacca Straits as a war
risks area due to piracy.
 Increased Value (IV): Increased Value cover protects the
shipowner against any difference between the insured value
of the vessel and the market value of the vessel.
Unit 33
Specialist policies
Various types of specialist policy exist, including:
 Overdue insurance: This is a form of insurance now largely
obsolete due to advances in communications. It was an early
form of reinsurance and was bought by an insurer when a
ship was late at arriving at her destination port and there
was a risk that she might have been lost (but, equally, might
simply have been delayed). The overdue insurance of the
Titanic was famously underwritten on the doorstep of
Lloyd's.
 Cargo insurance: Cargo insurance is underwritten on the
Institute Cargo Clauses, with coverage on an A, B, or C
basis, A having the widest cover and C the most restricted.
Unit 33
Salvage and prizes
 The term "salvage" refers to
the practice of rendering aid
to a vessel in distress. Apart
from the consideration that
sailors are honour-bound to
render assistance as required,
it is obviously in underwriters'
interests to encourage
assistance to vessels in danger
of being wrecked. A policy will
usually include a "sue and
labour" clause which will
cover the reasonable costs
incurred by a shipowner in his
avoiding a greater loss.
Unit 33
● At sea, a ship in distress will typically agree to "Lloyd's Open
Form" with any potential salvor. The Lloyd's Open Form
(LOF) is the standard contract, although other forms exist.
The Lloyd's Open Form is headed "No cure – no pay";
meaning that if the attempted salvage is unsuccessful, no
award will be made. However, this principle has been
weakened in recent years, and awards are now permitted in
cases where, although the ship might have sunk, pollution has
been avoided or mitigated.
Unit 33
● In other circumstances the "salvor" may invoke the SCOPIC
terms (most recent and commonly used version is SCOPIC
2000). In contrast to the LOF these terms mean that the
salvor will be paid even if the salvage attempt is unsuccessful.
The amount the salvor receives is limited to cover the costs of
the salvage attempt only. The Lloyd's Open Form, once
agreed, allows salvage attempts to begin immediately.
● A ship captured in war is referred to as a prize, and the
captors entitled to prize money. Again this risk is covered by
standard policies.
Unit 33
Exercises
 Translate into English:
a) Osiguranje je sredstvo zaštite od gubitka kojim (against
loss, whereby) troškove gubitka preuzima osiguravatelj.
b) Dokument koji obuhvaća (embodying) ugovor o
osiguranju zove se polica.
c) Pravi uzrok štete je bilo neadekvatno slaganje (inadequate
stowage) tereta.
d) Iz ovog razloga svako izviješće o havariji (accident report)
moraju potkrijepiti izvodi (extracts) iz brodskog dnevnika.
e) Nepažljivo zavarivanje izazvalo je (gave rise to) požar u
strojarnici.
Unit 33
Exercises
 Translate into English:
f)
Pravi uzrok štete je još uvijek nepoznat. Je li brod bio
prekrcan (overladen)?
g) Je li oprema za spašavanje na brodu bila u skladu sa
zakonskim propisima (statutory requirements)?
h) Kakvo je bilo vrijeme prilikom nezgode?
i) Koja je bila brzina našeg broda kada je došlo do sudara?
j) Partikularna havarija je gubitak nastao iz sasvim slučajnih
razloga (accidental reasons), kao što su nasukanje, požar,
sudar, itd.
Unit 33
Exercises
 Translate into English:
k) U partikularnoj havariji gubitak snosi (is borne) vlasnik
oštećene imovine (property), npr. broda ili tereta.
l) Partikularna havarija stoga predstavlja slučajan gubitak,
koji se tiče (concerns) samo vlasnika oštećene imovine.
m) Generalna havarija je gubitak koji je nastao (incurred)
namjerno ili dobrovoljno u vrijeme ugrožene sigurnosti
pomorskog pothvata (adventure).
n) Brod mora dokazati (prove) osiguratelju da ne snosi
odgovornost (liable for) za štetu.
Unit 33
 Translate into Croatian.
1. In case of accident, fire on board, collision or grounding, it
is important to make up proper reports.
2. The careless handling of the pumps gave rise to the fire.
3. In cases of injury to a person on the vessel, first aid should
be rendered immediately.
4. Names of tugs used and their positions around the vessel
should be shown on a diagram.
5. In case of collision with another vessel, fill out the required
form sending one copy to your insurance department.
6. His advice is not to admit liability for the collision even
though you may have hit the other vessel amidships on a
clear day when she was at anchor.
Unit 33
 Answer the questions.
a) Why should you not admit any liability or a fault? Who is
supposed to deal with it?
b) Give some examples of "actual total loss".
c) When does the "constructive total loss" occur?
d) What are the losses referred to as Particular Average?
e) What does General Average consist of?
f) What is an average adjuster in charge of?
g) Name some of the specialist policies.
h) When is the Lloyd's Open Form used?
i) Why will salvor be awarded even if the salvage attempt is
unsuccessful?
j) What is the amount the salvor receives in such a case?
Unit 33
Unit 33
 Complete the text using the following elements:
amount, customised, deduction, grounding, layup, refunded, reimbursed, removal, shafts.
YACHT INSURANCE
Yacht insurance terms and conditions afford totally
____________ insurance covers. The owner and the insurer
agree on a set ____________, which is paid out in the case of
total loss, without ____________, and holds for the complete
term of the contract. Partial damages are ____________ up
to the agreed value. The cost of new parts required for repair is
____________ without deduction. A bonus of 40% is
possible. Unlimited coverage is provided for salvage, wreckage
____________, and disposal costs. Gear and equipment are
also insured outside the yacht during winter ____________.
A customised yacht insurance policy may cover all damages,
including damage to machinery, propellers, ____________,
rudder, and equipment, due to ____________, collision,
sinking or leaks.
Unit 33
 Choose some of the elements and make your own
sentences.
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Unit 33
lead to
arise from
give rise to
caused by
be at liberty to
the model for
in (the) case of
under construction
protect against
be obsolete due to
breach the contract
render aid
Unit 33