Ocean Sea Freight Marine Cargo Insurance and Risk Management 3

Question 1

What does the abbreviation SRCC stand for in marine cargo insurance?

Accepted Answer

Strikes, Riots, and Civil Commotions

Answer

SRCC stands for Strikes, Riots, and Civil Commotions, a coverage extension that protects cargo against losses arising from labor disputes and civil unrest.

Question 2

What is 'abandonment' in the context of a marine insurance claim?

Accepted Answer

The insured surrenders all rights and interest in the cargo to the insurer in exchange for payment of a total loss claim

Answer

Abandonment allows the insured to hand over all remaining interest in the cargo to the insurer and receive a total loss settlement, which is most common in constructive total loss situations.

Question 3

What is the key difference between ICC (A) and ICC (B) cargo coverage?

Accepted Answer

ICC (A) is all-risk coverage with named exclusions, while ICC (B) covers only specific named perils listed in the clause

Answer

ICC (A) covers all risks of physical loss or damage except those specifically excluded, whereas ICC (B) only covers the specific perils enumerated in the clause, such as fire, earthquake, and washing overboard.

Question 4

What is a 'valued policy' in marine cargo insurance?

Accepted Answer

A policy in which the cargo's insured value is agreed upon at inception and paid in full upon a total loss without further valuation

Answer

Under a valued policy, the insured value is fixed at policy inception; if a total loss occurs, the agreed amount is paid without the need to reassess the cargo's value at the time of loss.

Question 5

What is the primary role of a Protection & Indemnity (P&I) Club in the shipping industry?

Accepted Answer

To provide mutual liability insurance to shipowners covering crew injuries, cargo damage claims, and third-party liabilities

Answer

P&I Clubs are mutual insurance associations that cover shipowners' liabilities, including crew illness and injury, damage to third-party cargo, collision liability, and pollution claims.

Ocean Sea Freight Practice Test

Ocean Sea Freight Practice Test

Ocean Sea Freight Marine Cargo Insurance and Risk Management 3