The main reason for making protest in the UK is usually to support a cargo owner's claim

against the underwriters.

7. When cargo has been damaged by a peril of the sea. e.g. inadequate ventilation imposed
by weather conditions.
Voyage policy
Ibis type of policy is usually used to provide cover for goods in transit and the limits of
the policy cover the named ports of the voyage. It is sometimes used to cover freight
insurance but rarely used for hull insurance.
Extended protest
There might he occasion when the Master is unsure as to the total extent of damage
incurred or the full nature of that damage. In such cases, when there is a possibility of
finding more damage than is apparent, the Master should extend the protest. This can be
carried out by noting protest in one port and if necessary extending protest in another port.
The time limit must be within 6 months of noting and extending.
Extended protest falls into two pans:
I. A stated account of all material circumstances which led up to the incident. The
statement would be signed by the Master and witnessed by another officer and would he
supported by any form of documentary evidence. i.e. log books, photographs. weather
charts. etc.
2. The protest made by the Master and the notary against the accident and losses/datnage
incurred by it.

Marine insurance
Although the ship owner is under no legal obligation to insure his vessel or the cargo
owner to insure his goods in transit, it has become essential because of the high capital
values involved and the reputation of operators. A contract of marine insurance is termed a
'policy' where the insurer indemnifies the assured party against loss during the marine
adventure. In return the assured party will pay the insurer an agreed amount of money for
the risk, known as the premium.
Shipowners would normally arrange insurance through a broker who organizes the
contract through a marine department of an insurance company or directly with the
Corporation of Lloyd's. Most marine policies are arranged through Lloyd's underwriters
and the risk is generally spread between different insurers which may include the 'Names'
in a Lloyd's syndicate.
Policy types
Time policy
This type of insurance policy provides cover for a specific period of time and is usually
used for hull insurance.
Conditions of marine insurance
Any contract of marine insurance Is established on the terms of 'utmost good faith'. This
effectively means that the assured should provide all relevant details to the insurer, to
enable a fair premium to be established. Such representations are declared during the

negotiation of the contract and set into the contract as preconditions, MOW commonly
known as 'warranties'.
Expressed warranty
An expressed warranty is a clause entered in the contract which expresses an actual
condition/requirement, e.g. that the vessel would not proceed north of latitude 75'N. ox
oath of latitude 65'S.
Implied warranty
The implied warranty is one where it is assumed that certain conditions arc taken for
granted. In the case of marine insurance an implied warranty is where the vessel is
seaworthy to complete the intended voyage or where the vessel is engaged on a legal
venture. Clearly. the insurance company would not want to be party to an 'illegal venture'
and the contract would be so established, with utmost good faith.
Insurance policy clauses
Standard clauses for marine insurance are included in the majority of policies. These were
drawn up by Lloyd's in 198.1 and cover the aspects of hull and machinery. A selection of
standard clauses are listed below.
Navigation
Such a clause stipulates the type of navigation that the vessel could be involved in and
still remain covered by the policy. Navigation with or without a marine pilot would be
pemiitted as would be trial trips. The vessel would be allowed to tow vessels in distress
but would not be allowed to be towed herself. unless she herself is in distress or as is
customary for the circumstances. The contract may also specify that the ship should not
engage in towage or salvage by a previously arranged agreement. Other statements could
cover a final voyage prior to the ship being scrapped. In such a case the insured value of
the vessel would be the established 'scrap value'.
Termination
The policy would automatically expire if the Classifi- cation Society was changed or the
vessel had her class
SO The Command Companion of Seamanship Techniques
charges under particular avenge. e.g. expenditure could be considered as costs of a port of
refuge. or crew wages.
Duty of the assured
It is considered the responsibility of the assured party to take all reasonable actions to
avert or reduce any loss for which a claim may arise. To encourage such action by the
assured, the underwriters would contribute to any particular charges incurred to protect
and save the property insured.
Notice of claims
Where a loss or damage has occurred the underwriters must be notified prior to survey. If
the incident occurs abroad, then this notice would he passed to the nearest Lloyd's agent.
Such notification allows a surveyor to be appointed for and on behalf of the underwriters.

It also provides the underwriter the time needed to obtain tenders for repairs and designate
a port to carry out such repairs. Generally it is usually the owners who arrange the tenders,
but the right of the underwriters to obtain their own tenders or seek alternative tenders
remains.
NB. A 15 per cent deduction from the claim can be made by the underwriters if the
owners fall to comply with the stated conditions.
A marine insurance policy would carry many more petaled clauses to cover a variety of
exclusions, e.g. war, capture, civil disturbance, amen or detainment. lockouts. sister ship
salvage. or loss caused by a selection of weapons, although 'war risks' are usually covered
by P 8 I Clubs.
Peril of the sea
Probably the most influential clause of the insurance policy covers kiss or damage caused
by named perils.
These fall into the following categories:
I. Perils of the seas, and associated navigable waters. include accident or casualty from
collision, stranding or heavy weather, but do not cover normal wear and tear from wind
or wave action.
2.
3.
4.
5.

Fire or explosion.
Jettison of Mores or equipment overboard in order to lighten, or relieve a vessel in an
attempt to refloat a stranded vessel or right a listed vessel.
Violent theft by persons external to the vessel.
Piracy applicable also to plunder caused by mutinous passengers or rioters who might
attack the ship from shore side positions.
Mixed policy
This policy incorporates the principles of both the time and voyage policies. It is generally
used for insuring the hull, machinery and equipment on board for a named voyage and
covers a stated period to beyond that time of arrival at the destination.
Valued policy
This is a policy which provides a fixed and agreed insured value on the subject matter
being insured. The value, once agreed. is binding on both parties to the agreement. The
insured value may not always be the same as the actual value but once established for the
purpose of the contract. the figure is fixed and is not open to dispute at a later tithe.
Unvalued policy
This policy is usually employed for freight insurance. The value of the subject matter for
insurance is not specified and is established in conjunction with the Marine Insurance Act.
Floating policy

This policy provides advance insurance cover for cargo intended for shipping for an
undefined period of time. The policy is established by a wbgardial lump sum insured. As
shipments are moved forward. they are declared to the underwriter who should endorse
the back of the policy. The insured value of each shipment subsequently reduces the
assured sum until it is exhausted. The period of cover is therefore subject to the number
and value of shipments which affect the initial lump sum.
Open cover
This is probably the most popular form of insuranc cover used by operators involved in
the regular import and export business. It is a longerm agreement. which is bining in
honour only, where the assured party declares the nature of shipments. and the underwriter
accepts these shipment details within the scope of the open cover policy. The agreement is
set in general terms usually for a period of 12 months and may not always include the
named carrier. because at the time of initiating the contract the carrier may not be known.
suspended or discontinued. It would also terminate in the event of a change of owners. a
change of flag. or if it was transferred to a new management or the use of title was altered.
Breach of warranty
notice to enable the policy to be changed and a new premium set. the vessel can remain on
full cover.
Such examples of breach of warranty are any change of cargo or trade. or attempting
salvage or towage. or a change in destination.
Continuation
In the event that the vessel operates beyond the term of the contract. continues at sea in
distress or in a port of refuge or even a port of call. she will he retained on full cover at a
prorata monthly premium. provided previous notice has been given to the underwriters.
Pollution hazard
This clause covers the damage to the vessel which has been deliberately caused by the
orders of a government authority to prevent or reduce a pollution hazard.

Assignment of the policy

If the policy is to he transferred to another party. the assured must sign a dated notice of
this new assignment. and append it to the policy.
75 por cont collision clauso
Following a collision with another vessel, the insurer is liable to pay 75 per cent of the
costs of
loss or damage to another vessel.
delay or loss of use of another vessel.
contracted salvage of another vessel or general average.
NB. The remaining 25 per cent is usually covered by the owner's P & I Club.
General average and salvage clause
The policy covers the assured party's contribution to general average. if applicable.
Where a vessel is engaged on a voyage in 'ballast' the owner has the right to claim for
sacrifice or expenditure incurred under general average and for particular

6. Contact from aircraft or objects falling onto the vessel from land. dock or @arbor
installations, e.g. dockside crane falling onto a vessel.
7. Earthquake. lightning. or volcanic eruption. Breakdown or accident to nuclear
installation or reactors.

The insurance policy would also cover such as:

Negligence of the Master. officers, crew. or marine pilots.
Negligence of contract repairers or charterers, provided they are not the assured.
Latent defects in the machinery such as boilers bursting or propeller shafts breaking.
Barratry by the Master. officers or crew.
NB. Barratry is any deliberate wrongful act which is detrimental and against the owner's
or charterers interests e.g. selling the vessel fraudulently. wilfully conning the ship
aground with fraudulent intent. selling ship's equipment or cargo illegally or engaging in
snuggling.
Insurance of cargo
In certain circumstances. under the terms of the bill of lading. the carrier is not liable for
loss or damage to cargo and as such the cargo owner has an insurable risk. In 1982 Lloyd's
drew up a set of standard clauses for use with the marine cargo insurance policy. The
clauses are designated into three groups A. B and C.
The A clauses cover all risks. whereas B and C clauses cover particular risks (B and C
clauses are identical with the exception of specified risks commit
The period of insurance is defined by transit of the goods, cover being provided from the
time the goods leave the warehouse and is continuous until the goods are delivered to the
consignee's warehouse or suitable storage place at the named destination.

Incurred losses of marine insurance

The type of loss incurred and the subsequent handling of any claim will vary. but the
principles of settlement are such that the assured party is not permitted to make a profit
from the loss:
Where a 'total kiss' is agreed. the assured party mum abandon what is left of the item
insured to the insurer.
Once the loss has been settled. the insurer is entitled to take over all claims and rights
of the assured against any third party for damages in respect of the loss incurred. This
would effectively prevent the assured party claiming twice for the same loss. This is
known as 'subrogation' and is the substitution tsf one party for another as creditor.
Total loss and constructive total loss
A total loss occurs when the item insured is totally destroyed or irretrievably lost.
A 'presumed total kiss' occurs when a ship is missing and her total loss can be presumed
following a reasonable period of time. A presumed loss is usually due a peril of the sea
except in a war zone area when it would be assumed to be a war risk.

A 'constructive total loss occurs when the Item insured is abandoned because total loss is
likely, or when the cost of repairs would cost more than the insured value. The assured
may keep possession of the item and claim 100 per cent partial loss or alternatively give
full possession to the underwriters and claim total loss. If such is the cuia, the insured
mum serve a 'Notice of Abandonment' on the insurers.
Particular average
A claim for 'particular average' occurs when a partial loss of the insured item is caused by
a peril which it is insured against and which is not designated as a 'general average loss'.
A Malta is advised to 'note protest' when a ease of particular avenge is declared and call in
a ship's surveyor as soon as is practicable. The need for a surveyor can be easily
recognized if it is understood that particular average directly affects the party who has an
interest in the insured item. e.g. the ship. the ship owner or the underwriters of the ship
owner.

Typical examples of where particular average would he declared are:

Damage to the ship due to collision or stranding.
Damage to the hull or machinery through fire or heavy weather.
Loss of shipboard equipment due to bad weather.
Damage to cargo through collision.
NB. Damage to cargo could still be considered as particular average and would become
the responsibility of the cargo owner (or his underwriters) as the interested party.
The average adjuster would expect to see all damage reports related to the incident. in
order to differentiate between what is general average and what is specified as particular
average. Additional documentation would also include any surveyor's reports on the
subsequent damage.