Definition

A promise of compensation for specific potential future losses in exchange for a periodic payment. Insurance is designed to protect the finance well-being of an insurance company or other entity in the case of unexpected loss. Some forms of insurance are required by law, while others are optional. Agreeing to the terms of an insurance policy creates a contract between the insured and the insurer. In exchange for payments from the insured (called premiums), the insurer agrees to pay the policy holder a sum of Monet upon the occurrence of a specific event. In most cases, the policy holder pays part of the loss (called the deductible) and the insurer pays the rest. Examples include car insurance, health insurance disability insurance, life insurance, and business insurance.

SCOPIC

One of the main negative factors in envoking SCOPIC (on the salvors behalf) is if the salvage attempt is successful the amount at which the salvor can claim under article 13 of LOF is discounted.
The Lloyd's Open Form, once agreed, allows salvage attempts to begin immediately. The extent of any award is determined later; although the standard wording refers to the Chairman of Lloyd's arbitrating any award, in practice the role of arbitrator is passed to specialist admiralty

uardian Disability Insurance Specimen Policy
A personal long term disability insurance policy is a legal document, and everything you think you have coverage for must be written into the actual disability insurance policy. If you think you see something on a proposal, or an agent tells you something, it is not a fact until you see it written into your physical disability insurance policy. The policy is the legal document, and you only have coverage that is outlined in the disability insurance policy. Our agency provides you with a sample disability insurance policy for download here, feel free to print it and spend a lot of time reviewing it. We believe that once you understand how the Provider Plus disability insurance policy pays a claim, you would not choose any other coverage. This is the policy that sells itself, so take some time to review it here.
There are several areas we encourage our customers to pay close attention to when reviewing a specimen disability insurance policy. Renewability, Definition of Total Disability, The Residual Disability Rider and COLA. If you would like some additional information to help you understand what some of the language within the policy means during a claim

Warranties and Conditions

A peculiarity of marine insurance, and insurance law generally, is the use of the terms condition and warranty. In English law, a condition typically describes a part of the contract that is fundamental to the performance of that contract, and, if breached, breaches the contract as a whole. By contrast, a warranty is not fundamental to the performance of the contract and breach of a warranty will not lead to a breach of the contract. The meaning of these terms is reversed in insurance law. Thus, the Marine Insurance Act 1906 refers to implied warranties, one of the most important of which is that the vessel is seaworthy.

Specialist Policies

Various types of specialist policy exist, including:
New building risks: This covers the risk of damage to the hull whilst it is under construction.
Yacht Insurance: Insurance of pleasure craft is generally known as 'yacht insurance' and includes liability coverage. Smaller vessels, such as yachts and fishing vessels are typically underwritten on a 'binding authority' or 'line slip' basis.
War risks: Usual Hull insurance does not cover the risks of a vessel sailing into a war zone. A typical example is the risk to a tanker sailing in the Persian Gulf during the gulf War risks cover protects, at an additional premium, against the danger of loss in a war zone. The war risks areas are established by the London-based Joint War Committee, which has recently moved to include the Malacca straits as a war risks area due to privacy. If an attack is classified as a "riot" then it would be covered by war risk insurers
Increased Value (IV): Increased Value cover protects the ship owner against any difference between the insured value of the vessel and the market value of the vessel.
Overdue insurance: This is a form of insurance now largely obsolete due to advances in communications. It was an early form of reinsurance and was bought by an insurer when a ship was late at arriving at her destination port and there was a risk that she might have been lost (but, equally, might simply have been delayed). The overdue insurance of the Titanic was famously underwritten on the doorstep of Lloyd's.

Excess, Deductible, Retention, Co-Insurance, and Franchise

An Excess is the amount payable by the insured and is usually expressed as the first amount falling due, up to a ceiling, in the event of a loss. An excess may or may not be applied. It may be expressed in either monetary or percentage terms. An excess is typically used to discourage moral hazards and to remove small claims, which are disproportionately expensive to handle. The equivalent term to 'excess' in marine insurance is 'deductible' or 'retention'.
A co-insurance, which is typically applied in non-proportional treaty reinsurance, is an excess expressed as a proportion of a claim, e.g. 5%, and applied to the entirety of a claim.
A franchise is a deductible below which nothing is payable and beyond which the entire amount of the sum insured is payable. It is typically used in reinsurance arbitrage arrangements.

Average

The term 'Average' has two meanings:
(1) In marine insurance, in the case of a partial loss, or emergency repairs to the vessel, average may be declared. This covers situations, where, for example, a ship in a storm might have to jettison certain cargo to protect the ship and the remaining cargo. General average requires all parties concerned in the venture (Hull/Cargo/Freight/Bunkers) to contribute to compensate the losses caused to those whose cargo has been lost or damaged. 'Particular Average' is levied on a group of cargo owners and not all of the cargo owners.
(2) In the situation where an insured has under-insured, i.e. Insured an item for less than it is worth, average will apply to reduce the amount payable. There are different ways of calculating average, but generally the same proportion of under-insurance will be applied to any payout due.
An average adjuster is a marine claims specialist responsible for adjusting and providing the general average statement. He is usually appointed by the ship owner or insurer.

Actual Total Loss and Constructive Total Loss

These two terms are used to differentiate the degree of proof where a vessel or cargo has been lost.
An Actual Total Loss refers to the situation where the position is clear and a Constructive Total Loss refers to the situation where a loss is inferred. In practice, a Constructive Total Loss might also be used to describe a loss where the cost of repair is not economic; i.e. a 'write-off'.
The different terms refer to the difficulties of proving a loss where there might be no evidence of such a loss. In this respect, marine insurance differs from non-marine insurance, where the insured is required to prove his loss. Traditionally, in law, marine insurance was seen as an insurance of 'the adventure', with insurers having a stake and an interest in the vessel and/ or the cargo rather than, simply, an interest in the financial consequences of the subject-matter's survival.

Protection and indemnity

A marine policy typically covered only three-quarter of the insured's liabilities towards third parties. The typical liabilities arise in respect of collision with another ship, known as 'running down' (collision with a fixed object is an 'allision'), and wreck removal (a wreck may serve to block a harbor, for example).
In the 19th century, ship owners banded together in mutual underwriting clubs known as protection and indemnity clubs (P&I), to insure the remaining one-quarter liability amongst themselves. These Clubs are still in existence today and have become the model for other specialized and infomercial marine and non-marine mutual’s, for example in relation to oil pollution and nuclear risks.
Clubs work on the basis of agreeing to accept a ship-owner as a member and levying an initial 'call' (premium). With the fund accumulated, reinsurance will be purchased; however, if the loss experience is unfavorable one or more 'supplementary calls' may be made. Clubs also typically try to build up reserves, but this puts them at odds with their mutual status.
Because liability regimes vary throughout the world, insurers are usually careful to limit or exclude American Jones act liability.

Practice

The Marine Insurance Act includes, as a schedule, a standard policy (known as the 'SG form'), which parties were at liberty to use if they wished. Because each term in the policy had been tested through at least two centuries of judicial precedent, the policy was extremely thorough. However, it was also expressed in rather archaic terms. In 1991, the London market produced a new standard policy wording known as the MAR 91 form and using the Institute Clauses. The MAR form is simply a general statement of insurance; the Institute Clauses are used to set out the detail of the insurance cover. In practice, the policy document usually consists of the MAR form used as a cover, with the Clauses stapled to the inside. Typically each clause will be stamped, with the stamp overlapping both onto the inside cover and to other clauses; this practice is used to avoid the substitution or removal of clauses.
Because marine insurance is typically underwritten on a subscription basis, the MAR form begins: We, the Underwriters, agree to bind ourselves each for his own part and not one for another [...]. In legal terms, liability under the policy is several and not joint; i.e. The underwriters are all liable together, but only for their share or proportion of the risk. If one underwriter should default, the remainder is not liable to pick his share of the claim.

Origins of Formal Marine Insurance..

Origins of Formal Marine InsuranceThe modern origins of marine insurance law were in the law merchant, with the establishment in England in 1601 of a specialized chamber of assurance separate from the other Courts. Lord mans field lord peace justice in the mid-eighteenth century, began the merging of law merchant and common law principles. The establishment of Lyoid’s of London, competitor insurance companies, a developing infrastructure of specialists (such as ship broker, admiratly lawyers, and bankers), and the growth of the British empire gave English law a prominence in this area which it largely maintains and forms the basis of almost all modern practice. The growth of the London insurance market led to the standardization of policies and judicial precedent further developed marine insurance law. In 1906 the Marine Insurance Act was passed which codified the previous common law; it is both an extremely thorough and concise piece of work.

Marine insurance act …. UK

Lax Moratoria. Professors Healy and Sharpe have described the relationship between the United Kingdom's Marine Insurance Act and the American law of marine insurance as follows: "While Congress has not restated the marine insurance law of the United States, the U.K. law of marine insurance was codified in 1906, when the Marine Insurance Act became law. Of course the Act does not apply of its own force in the United States, but U.S. and U.K. courts alike have recognized the desirability of uniformity in the law of marine insurance . . . . While some differences still exist, a considerable degree of uniformity has in fact been achieved, so that the Marine Insurance Act is not only a codification of U.K. law, but can be read as a reasonably close restatement of the still-decisional U.S. law of marine insurance.