Year : 1963
In this Act, unless the context otherwise requires,-
(a) "Contract of marine insurance" means a contract of marine insurance as defined by section 3;
(b) "Freight" includes the profit derivable by a ship-owner from the employment of his ship to carry his own goods or other movables, as well as freight payable by a third party, but does not include passage money;
(c) "Insurable property" means any ship, goods or other movables which are exposed to maritime perils;
(d) "Marine adventure" includes any adventure where-
(i) Any insurable property is exposed to maritime perils;
(ii) The earnings or acquisition of any freight, passage money,commission, profit or other pecuniary benefit, or the security for any advances, loans, or disbursements is endangered by the exposure of insurable property to maritime perils;
(iii) Any liability to a third party may be incurred by the owner of, or other person interested in or responsible for, insurable property by reason of maritime perils;
(e) "Maritime perils" means the perils consequent on, or incidental to, the navigation of the sea, that is to say, perils of the seas, fire, war perils, pirates, rovers, thieves, captures, seizures, restraints and detainment of princes and peoples, jettisons, barratry and any other perils which
(f) "Movables" means any movable tangible property, other than the ship, and includes money, valuable securities and other documents;
(g) "Policy" means a marine policy;
(h) "Ship" includes every description of vessel used in navigation;
(i) "Suit" includes counter-claim and set-off.
Subject to any express provision or valuation in the policy, the insurable value of the subject-matter insured must be ascertained as follows:-
(1) In insurance on ship, the insurable value is the value, at the commencement of the risk, of the ship, including her outfit, provisions, and stores for the officers and crew, money advanced for seamens wages, and other disbursements (if any) incurred to make the ship fit for the voyage or adventure contemplated by the policy, plus the charges of insurance upon the whole:
The insurable value, in the case of a steamship, includes also the machinery, boilers, and coals and engine stores if owned by the assured; in the case of a ship driven by power other than steam includes also the machinery and fuels and engine stores, if owned by the assured; and in the case of a ship engaged in a special trade, includes also the ordinary fittings requisite for that trade;
(2) In insurance on freight, whether paid in advance or otherwise, the insurable value is the gross amount of the freight at the risk of the assured, plus the charges of insurance:
(3) In insurance on goods or merchandise, the insurable value is the prime cost of the property insured, plus the expenses of and incidental to shipping and the charges of insurance upon the whole:
(4) In insurance on any other subject-matter, the insurable value is the amount at the risk of the assured when the policy attaches, plus the charges of insurance.
Subject to the provisions of the preceding section as to circumstances which need not be disclosed, where an insurance is effected for the assured by an agent, the agent must disclose to the insurer-
(a) Every material circumstance which is known to himself, and an agent to insure is deemed to know every circumstance which in the ordinary course of business ought to be known by, or to have been communicated to him; and
(b) Every material circumstance which the assured is bound to disclose, unless it comes to his knowledge too late to communicate it to the agent.
(1) Where a ship, without lawful excuse, deviates from the voyage contemplated by the policy, the insured is discharged from liability as from the time of deviation, and it is immaterial that the ship may have regained her route before any loss occurs.
(2) There is a deviation from the voyage contemplated by the policy-
(a) Where the course of the voyage is specifically designated by the policy, and that course is departed from; or
(b) Where the course of the voyage is not specifically designated by the policy, but the usual and customary course is departed from.
(3) The intention to deviate is immaterial; there must be a deviation in fact to discharge the insurer from his liability under the contract.
matter liable to contribution is insured for its full contributory value; but, if such subject-matter be not insured for its full contributory value, or if only part of it be insured, the indemnity payable by the insurer must be reduced in proportion to the under insurance, and where there has been a particular average loss which constitutes a deduction from the contributory value, and for which the insurer is liable, that amount must be deducted from the insured value in order to ascertain what the insurer is liable to contribute.
(2) Where the insurer is liable for salvage charges the extent of his liabilities must be determined on the like principle.
(1) Where there has been a loss in respect of any subject-matter not expressly provided for in the foregoing provisions of this Act, the measure of indemnity shall be ascertained as nearly as may be, in accordance with those provisions, in so far as applicable to the particular case.
(2) Nothing in the provisions of this Act relating to the measure of indemnity shall affect the rules relating to double insurance, or prohibit the insurer from disproving interest wholly or in part, or from showing that at the time of the loss the whole or any part of the subject-matter insured was not at risk under the policy.
provided there has been no fraud or illegality on the part of the assured; but if the risk is not apportion able, and has once attached, the premium is not returnable;
(b) Where the subject-matter insured, or part thereof, has never been imperilled the premium, or, as the case may be, a proportionate part thereof, is returnable:
Provided that where the subject-matter has been insured "lost or not lost", and has arrived in safety at the time when the contract is concluded, the premium is not returnable unless, at such time, the insurer knew of the safe arrival;
(c) Where the assured has no insurable interest throughout the currency of the risk the premium is returnable, provided that this rule does not apply to a policy effected by way of wagering;
(d) Where the assured has a defeasible interest which is terminated during the currency of the risk, the premium is not returnable;
(e) Where the assured has over-insured under an unvalued policy, a proportionate part of the premium is returnable;
(f) Subject to the foregoing provisions, where the assured has over-insured by double insurance, a proportionate part of the several premiums is returnable:
Provided that, if the policies are effected at different times, and any earlier policy has at any time borne the entire risk, or if a claim has been paid on the policy in respect of the full sum insured thereby, no premium is returnable in respect of that policy, and when the double insurance is effected knowingly by the assured no premium is returnable.
(1) Where any right, duty, or liability would arise under a contract of marine insurance by implication of law, it may be negatived or varied by express agreement, or by usage, if the usage be such as to bind both parties to the contract.
(2) The provisions of this section extend to any right, duty, or liability declared by this Act which may be lawfully modified by agreement.
Nothing in clause (e) of section 6 of the Transfer of Property Act, 1882, (4 of 1882.) shall affect the provisions of sections 17,52, 53 and 79.
The rules of law, including the law merchant, which applied to contracts of marine insurance immediately before the commencement of this Act, save in so far as they are inconsistent with the express provisions of this Act, shall continue to apply to contracts of marine insurance.
MEMORANDUM N.B.-Corn, fish, salt, fruit, flour, and seed are warranted free from average, unless general or the ship be stranded,-sugar, tobacco, hemp, flax, hides and skins are warranted free from average, under five per cent., and all other goods, also the ship and freight, are warranted free from average, under three percent. unless general, or the ship be stranded.
RULES FOR CONSTRUCTION OF POLICY
The following are the rules referred to by this Act for the construction of a policy in the above or other like form, where the context does not otherwise require:-
1. Lost or not lost.
Where the subject-matter is insured "lost or not lost" and the loss has occurred before the contract is concluded, the risk attaches unless, at such time the assured was aware of the loss, and the insurer was not.
Where the subject-matter is insured "from" a particular place, the risk does not attach until the ship starts on the voyage insured.
3. At and from.
(a) Where a ship is insured "at and from" a particular place, and she is at that place in good safety when the contract is concluded, the risk attaches immediately.
(b) If she be not at that place when the contract is concluded, the risk attaches as soon as she arrives there in good safety, and, unless the policy otherwise provides, it is immaterial that she is covered by another policy for a specified time after arrival.
(c) Where chartered freight is insured "at and from" a particular place, and the ship is at that place in good safety when the contract is concluded, the risk attaches immediately. If she be not there when the contract is concluded, the risk attaches as soon as she arrives there in good safety.
(d) Where freight, other than chartered freight, is payable without special conditions and is insured "at and from" a particular place the risk attaches pro rata as the goods or merchandise are shipped;
Provided that if there be cargo in readiness which belongs to the ship-owner, or which some other person has contracted with him to ship, the risk attaches as soon as the ship is ready to receive such cargo.
4. From the loading thereof.
Where goods or other movables are insured "from the loading thereof", the risk does not attach until such goods or movables are actually on board, and the insurer is not liable for them while in transit from the shore to the ship.
5. Safely landed.
Where the risk on goods or other movables continues until they are "safely landed", they must be landed in the customary manner and within a reasonable time after arrival at the port of discharge, and if they are not so landed the risk ceases.
6. Touch and stay.
In the absence of any further license or usage, the liberty to touch and stay "at any port or place whatsoever"does not authorize the ship to depart from the course of her voyage from the port of departure to the port of destination.
7. Perils of the seas.
The term "perils of the seas" refers only to fortuitous accidents or casualties of the seas. It does not include the ordinary action of the winds and waves.
The term "pirates" includes passengers who mutiny and rioters who attack the ship from the shore.
The term "thieves" does not cover clandestine theft or a theft committed by any one of the ships company, whether crew or passengers.
10. Restraint of princes.
The term "arrests, etc., of kings, princes, and people" refers to political or executive acts, and does not include a loss caused by riot or by ordinary judicial process.
The term "barratry" includes every wrongful act willfully committed by the master or crew to the prejudice of the owner, or as the case may be, the charterer.
12. All other perils.
The term "all other perils" includes only perils similar in kind to the perils specifically mentioned in the policy.
13. Average unless general.
The term "average unless general"means a partial loss of the subject-matter insured other than a general average loss, and does not include "particular charges".
Where the ship has stranded, the insurer is liable for the excepted losses although the loss is not attributable to the stranding, provided that when the stranding takes place the risk has attached and, if the policy be on goods, that the damaged goods are on board.
The term "ship" includes the hull, material and outfit, stores and provisions for the officers and crew, and, in the case of vessels engaged in a special trade, the ordinary fittings requisite for the trade, and also, in the case of a steamship, the machinery, boilers, and coals and engine stores, if owned by the assured and also in the case of a ship driven by power other than steam, the machinery and fuels and engine stores, if owned by the assured.
The term "freight" includes the profit derivable by a ship-owner from the employment of his ship to carry his own goods or movable as well as freight payable by a third party, but does not include passage money.
The term "goods" means goods in the nature of merchandise, and does not include personal effects or provisions and stores for use on board.In the absence of any usage to the contrary, deck cargo and living animals must be insured specifically, and not under the general denomination of goods.