Codification of the Law of Marine Insurance

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Codification of the Law of Marine Insurance

Codification Of The Law Of Marine Insurance

01. Condifcation

The Marine Insurance Act 1906 (hereafter referred to as the MIA within the Marine Insurance Law Series) codifies all decisions of Courts and industry practices within the marine industry.

02. Definition of Marine Insurance

Section 1 MIA – A contract of marine insurance is a contract whereby the insurer undertakes to indemnify the assured, in manner and to the extent thereby agreed, against losses that is to say the losses incident to marine adventure as seen in case of The Captain Panagos DP.

03. Mixed Sea and Land Risk

Section 2(1) MIA usually covers cargo related policies on a warehouse to warehouse basis as seen in the case of Wunsche International mbH v Tai Ping Insurance Co. As such this section covers cargo which are moved utilizing a multimodal transportation system from land to water and vice versa.

In addition to the above, it is safe to say that any risks pertaining to inland waterways are also covered within marine insurance even though such adventure may not be incidental to any sea voyage. This was decided in the case of Hansen Development Pty Ltd v MMI Ltd.

Section 2(2) MIA on the other hand provides that shipbuilding launch of a ship or any adventure similar to a marine adventure is covered by a marine policy.

04. Marine Adventure and Maritime Perils

Section 3(1) MIA provides that all lawful adventure may be subject to a contract of marine insurance.

Section 3(2) MIA states that ships, goods, freights and liability to a third party can be subjected to a marine adventure where the risk of loss  or liability is the result of exposure to the maritime perils. A number of cases can be used to illustrate this provision such as The Nukila and Gibbs v Mercantile Mutual Insurance.

05. Marine Insurance Affords Indemnity

Indemnity for a marine insurance will rely on agency of those perils against which the underwriter by the terms of the policy stands to protect the insured. This will be seen the cases of Irving v Manning and Robertson v Nomikos.

06. Distinction Between Marine Insurance Contracts and Wagers

An interest in the subject matter insured and exposure of that interest to risk of loss or detriment by maritime perils are essential to a contract of marine insurance. This principal can be seen in the cases of Prudential Insurance Co v IRC, Fuji Finance Ltd v Aetna Insurance Co Ltd and Feasey v Sun Life Assurance Co Ltd.

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