Marine Cargo Insurance and Risk Management Flashcards
7 cards from real Ocean Sea Freight practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Marine Cargo Insurance and Risk Management flashcards as text
What is 'particular average' in marine cargo insurance?
Answer: A partial loss that affects only one cargo interest and is borne solely by that owner
Particular average is a partial loss affecting only the owner of the damaged goods and is not shared among other parties to the voyage, unlike general average.
Which Institute Cargo Clause provides the LEAST coverage for cargo?
Answer: ICC (C)
ICC (C) is the most restrictive clause, covering only major casualties such as fire, explosion, stranding, sinking, collision, and jettison of cargo.
What is a 'deductible' in a marine cargo insurance policy?
Answer: A predetermined amount that is subtracted from every claim payment, borne by the insured
A deductible is the portion of any loss the insured must absorb before the insurer covers the remaining amount of the claim.
What does 'war risk' coverage in a marine cargo policy protect against?
Answer: Losses caused by acts of war, mines, torpedoes, and other hostile acts that are excluded from standard policies
War risk is a separate endorsement or policy that reinstates coverage for losses from hostile acts — such as war, mines, and torpedoes — that are standard exclusions in basic cargo policies.
What is a 'constructive total loss' in marine cargo insurance?
Answer: The cost to recover or repair the cargo exceeds its insured value, making recovery uneconomical
A constructive total loss occurs when the cost of salvage, repair, or forwarding the cargo to its destination would exceed its insured value, so the insured can claim a total loss.
What is an 'open cover' marine insurance policy?
Answer: A blanket policy that automatically covers all shipments made by the insured within agreed terms without needing separate arrangements per shipment
An open cover policy provides continuous automatic insurance for all qualifying shipments within the agreed parameters, making it efficient for businesses that ship regularly.
Who typically issues a certificate of insurance for an ocean cargo shipment?
Answer: The insurance company or its authorized agent, such as the freight forwarder
A certificate of insurance is issued by the insurer or its authorized agent — often the freight forwarder — as evidence that the cargo is covered by a marine insurance policy.