Vessels are insured on Institute Time clauses (Hull) against the following marine perils:
- Total loss and Constructive Total loss
- Particular Average (A partial loss proximately caused by an insured peril)
- Perils of the sea, lakes or other navigable waters
- Fire, explosion
- Violent theft by persons from outside the vessel
- Jettison of cargo
- Boiler explosions
- Stranding/grounding damage
- Damage due to heavy weather
- Damage occasioned by crew negligence
In any insurance policy, there are always exclusions i.e. certain types of losses that are not covered by the hull underwriters. These are:
- Loss due to willful misconduct of the assured.
- Loss caused by delay (in performing the voyage, completing cargo operations, commencing heating of cargo etc.).
III. Wear and tear.
- Rats or Vermin.
- Loss occurring when the vessel was not able to maintain her class (due to expiry of her trading certificates, non-compliance with Classification Society requirements as to seaworthiness or maintenance).
- Loss caused by warlike activities. (Such loss however is covered under a War Risk policy)
VII. Loss occurring outside the Institute trading warranty limit. Unless permission has been given by underwriters for trading outside the trading limit. (Sometimes, the insured has to pay an additional premium for the breach of this warranty).
VIII. Towage – The exception does not apply when the vessel performs towage of vessels or crafts in peril that are in need of assistance, in which case the vessel in peril shall be towed to the first safe port. However, where there is intention to undertake towage or salvage services under contract, prior notice shall be given to underwriters, as otherwise that would constitute a breach of warranty.
The Master must thereafter:
- Inform the office of the salient details of the incident;
- Make appropriate entries in the logbooks;
- Maintain a log of the events that are relevant to the incident and its aftermath, until the incident has been finally resolved;
- Carry out an investigation into the incident and prepare a report listing the pertinent facts, including statements from the persons involved in the incident or witness to it;
- Prepare an NCR, giving details of the incident and observed damages.
You may also know about P and I clubs –
Some of the risks or incidents that are covered by the P&I clubs:
a) Compensation for loss of life and or injury to crewmembers for hospitalization, medical expenses etc.
b) Death or injury to stevedores and other third parties.
c) Loss of seaman’s personal effect.
d) Deviation expenses, port charges etc. for the purpose of saving life or for landing an injured or sick crew member from the ship for medical treatment.
- For short or over delivery of cargo;
- Failure to comply with regulations as to declarations of goods or documentation as to cargo carried.
f) Oil pollution, subject to a limit of USD 500 million each occurrence.
g) Loss or damage to fixed or floating objects; piers, jetties, buoys etc.
h) One-fourth collision liability for loss or damage caused to another vessel due to collision.
i) Loss or damage caused to cargo carried on board.
j) Life salvage
k) Wreck removal – costs and expenses reasonably incurred for the raising, removal, destruction, lighting or marking of the wreck of an entered vessel to the extent that such measures are compulsory by law.
It is important to note that every vessel should have a copy of the P&I club Rule Book and the Club’s Entry Certificate. Master and Senior officers are required to familiarize themselves with the contents of the Rule Book.