Chapter 9

  1. Commercial Ocean Marine Insurance (Wet Marine Insurance)
    insurance for on-going vessels and cargo; no standard ocean marine policies; written "full value" and will become void if certain implied warranties are violated such as Legality, Seaworthiness, No deviation in Voyage
  2. Hull Insurance (coverage)
    covers physical damage to the ship itself, open or named peril basis, cover a particular voyage or for one year
  3. Cargo Insurance
    cover the goods being shipped while in transit; open or named perils; provided during the time the insured has an interest in property; FOB point of departure - buyer take interest in property as soon as the trip begins, FOB point of Destination - seller retains interest in property until after the trip is completed; coverage written on single shipment or open cargo basis; warehouse to warehouse clause may be attached; policy - written continuous (in force until cancelled )
  4. Freight insurance
    an indirect loss coverage that protects the shipper, required to prepay frieght charges and/or import duties, in the even that voyage is not completed or goods substained have partial damage and shipper is not able to secure refund of duty on damaged goods
  5. General average
    a partial loss where the loss is shared among all who benefited by the sacrifice like throwing cargo on board to save the ship
  6. Particular Average
    • partial loss that affects only a particular interest
    • loss is not shared
  7. the collision or running down clause
    • a provision contained in Hull Insurance
    • covers collision damage to another vessel
  8. Inchmaree Clause
    • addition to Hull Insurance
    • covers damage caused by bursting of boilers, breaking of propeller shafts or loss due to faults in navigation by crew
  9. personal inland marine insurance
    • can be attached to Homeowners policy or stand-alone
    • insure movable property against direct loss
    • movable property = floating property
  10. Personal Articles Floater
    • Basic form - to insure "individual" personal property
    • itemized or scheduled basis
    • provides excellent coverage for antiques
    • claims - settled on ACV basis
    • coverage- worldwide
    • provide open peril coverage for direct physical loss to property described; exclusions - tears and wear, gradual deterioration, insects, vermin, inherent vice, war or nuclear risks
  11. Principal 9 classes of coverage
    • 1. Jewelry
    • 2. Furs
    • 3. Cameras
    • 4. Musical instruments
    • 5. Silverwre or goldware
    • 6. Golfer's equipment
    • 7. Fine Arts
    • 8. Stamp Collections
    • 9. Coin Collections
  12. Personal jewelry floater
    • written on valued or ACV basis
    • contains "Pair or Sets clause" - allows company to pay for a loss in proportion to the actual loss when a pair is damged
    • appraisal - mandatory before or at the time of insuring
    • must report newly acquired items within 30 days
    • must pay additional premium
    • exhibition floater - not a Personal floater
  13. Personal effects floater
    • open peril coverage for items worn by travelers
    • coverage - worldwide, not at insured's home
  14. Fine Arts floater
    • covers items like paintings, rare manuscripts and antiques
    • automatic coverage for 90 days for new items
    • written on valued basis
  15. Camera Floater
    • insured items - scheduled, blanket coverage on items such as shades, filters, etc
    • automatic coverage 0 on newly itmes for 30 days up to 25% of exisiting policy amt
  16. Musical instrument floater
    • not to be played for remuneration
    • playing for hire must purchase endorsement acknowledging such use
    • pay additional premium
    • must report new itmes within 30 days
    • pay an additional premium
  17. Boatowners Policy
    • similar to homeowners policy and personal auto policy
    • to cover boats that can be towed by automobiles
    • Sec I - open peril coverage for hull, motor, trailer, equip and accessories for marine use, Loss - ACV basis
    • Sec II - watercraft liability, medical payments, uninsured boaters
    • coverage will apply during unofficial speed race or contest
  18. Outboard Motorboat policy
    • Inland Marine Form, to cover outboard motors and boats against a direct loss
    • open peril basis, may be on named peril basis
    • written on ACV basis, adjust coverage limits downards as the boat ages
    • liability coverage - picked up in Homeowners Section II
  19. Yatch Policy
    • Ocean Marine Form
    • provides both property and liability coverage
    • larger vessels normally insured under complete package of yacht coverages in addition to Hull insurance
    • Lay up warranty - insured boat is in storage, allows for a return of premium due to lower risk
    • navigational limits - yatch is allowed to operate, if permission not granted, insurer can deny coverage for losses outside area limit
  20. Difference in Condition (DIC ) insurance
    • special form to fill gaps of property policy
    • no std policy form
    • open peril basis excluding losses by perils covered under std property forms
    • no Coinsurance clause or pro rata clause
    • written for amt different from policy it complements
    • if written to supplement underlying policy - carries high deductible 10,000 or more
    • provide coverage in event of earthquake, flood, collapse and subsidence
  21. Aircraft Hull Insurance
    • open peril basis physical loss or damage to insured aircraft where it is on ground or in flight
    • 2 deductibles - in-motion deductible and not-in-motion deductible, in motion - whenever in motion or in flight
    • must be flown by pilots described in summary page
    • aircraft must be registered under Standard Category Airworthiness Certificate by Federal Aviation Administration (FAA)
    • exclusions - illegal use, wear and tear, damage resulting from mechinical breakdown, conversion , structural failure loss
  22. National Flood Insurance Program (NFIP)
    • federal program, enable owner to purchase flood insurance, administer programs under FEMA (federal emergency management agency), payment for loss - made by federal government,
    • agents don't have authority to bind coverage with NFIP
    • may write flood insurance w/c NFIP
Card Set
Chapter 9
Chapter 9