Marine Insurance Law Flashcards

The principle of 'uberrimae fidei' (utmost good faith) in marine insurance requires the insured to:

Answer: Disclose all material facts known to them before the policy is issued

Utmost good faith obligates the insured to voluntarily disclose all material information that might affect the insurer's decision to underwrite or the premium charged.

A 'valued policy' in marine insurance means:

Answer: The insured value of the vessel is agreed at inception and is conclusive in the event of total loss

Under a valued policy, the agreed insured value is conclusive for total loss purposes, regardless of the vessel's actual market value at the time of loss.

In marine insurance, 'average' refers to:

Answer: A partial loss or damage, as distinguished from a total loss

In marine insurance terminology, 'average' means a partial loss — either particular average (affecting only specific interests) or general average (shared by all voyage interests).

Which type of marine insurance policy covers cargo owners for loss or damage to goods during transit?

Answer: Cargo (marine cargo insurance)

Marine cargo insurance protects the cargo owner against physical loss or damage to goods while in transit by sea, air, or land.

A 'Protection and Indemnity' (P&I) Club primarily provides shipowners with coverage for:

Answer: Third-party liabilities including crew injury, cargo damage, and collision liability

P&I Clubs are mutual insurance associations that cover shipowners' third-party liabilities such as personal injury, cargo damage, pollution, and wreck removal.

The 'running down clause' (RDC) in a hull policy covers:

Answer: The insured vessel's liability to another vessel in a collision

The Running Down Clause (also called the Collision Liability Clause) covers the shipowner's liability to the other vessel and its cargo for damage caused in a collision.