Marine Insurance Law Flashcards
6 cards from real Maritime Law practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Marine Insurance Law flashcards as text
The 'Institute Cargo Clauses (A)' provide the broadest cargo coverage because they use which coverage basis?
Answer: All risks of loss or damage
ICC (A) clauses cover all risks of physical loss or damage to the cargo subject to standard exclusions, making them the widest standard cargo coverage available.
In marine insurance, 'general average' requires all parties sharing in a maritime venture to contribute to:
Answer: Losses deliberately incurred to save the venture from a common peril
General average is the principle that all parties (ship, cargo, freight) must contribute proportionally to extraordinary sacrifices or expenses made to save the whole venture from a common peril.
Under U.S. law, which Act governs the general average obligations for voyages to or from the United States?
Answer: York-Antwerp Rules (incorporated by contract) and the U.S. Carriage of Goods by Sea Act
General average in U.S. practice is typically governed by the York-Antwerp Rules as incorporated into the bill of lading or charter party, alongside COGSA provisions.
A 'constructive total loss' (CTL) in marine insurance arises when:
Answer: The cost of repair or recovery exceeds the insured value of the vessel
A CTL occurs when the vessel is not an actual total loss but the cost of recovering or repairing it would exceed its insured value, making it commercially a total loss.
When a marine insurer pays a total loss claim, it acquires the insured's rights against third parties through:
Answer: Subrogation
Subrogation allows the insurer who has paid a loss to step into the insured's shoes and pursue recovery from the party responsible for the loss.
The 'sue and labour' clause in a marine policy obligates the insured to:
Answer: Take reasonable steps to minimize or prevent a covered loss, with costs reimbursed by the insurer
The sue and labour clause requires the insured to take all reasonable measures to avert or minimize a loss, and the insurer reimburses reasonable expenditures incurred in doing so.