3. ORIGINS OF MARINE INSURANCE  MARINE INSURANCE is as old as Civilisation.Code of Manu contains rules for Marine Contracts which were observed by Traders from Bharuch and Surat who traded with merchants in Sri-Lanka, Egypt and Greece  System of executing Jokhami Hundies. The Hundies were drawn on the Goods shipped on the vessel mentioned in the Hundi. The Insurer purchased the Hundi from the Seller/Exporter by paying the value of the Goods upfront and was entitled to receive this value + Insurance Premium = Value of the Hundi in case the vessel reached safely and the Hundi value recovered from the Buyer /Importer  RHODIANS introduced MARITIME CUSTOMS AND PRACTICES during 900 B.C. They also introduced the concept of GENERAL AVERAGE.

4. ORIGINS OF MARINE INSURANCE ……..contd. Rhodians also introduced the concept of Bonds--- 1.BOTTOMRY BOND-loan on the security of the vessel. Loan not re- payable if the venture was lost. 2.RESPONDENTIA BOND-loan on the security of the cargo. Loan not repayable if the cargo was lost. Marine Insurance as it is practiced today originated in a crude form in the 12 th Century in a place in ITALY called Lombardy. The 14 th Century Italian Merchants broke the Bonds into Financing and Risk-taking TECHNICAL Insurance as is being Practiced today started in the COFFEE CLUB of Edward Lloyds in the 16 th Century and the S.G.Policy was introduced in 1779 A.D.

5. NEED FOR MARINE INSURANCE SAFETY:- In International Trade, Markets are highly competitive and profit margins are very thin. Marine Cargo Insurance allows Insurance on CIF+10% (towards incidentals and Profit) CONTRACTUAL PROVISIONS:- enjoin upon the Seller/Buyer to arrange Insurance as per the INCO- TERMS agreed eg. FOB/C&F/CIF CUSTOMS FORMALITIES:- Customs will levy Customs Duty on the landed Cost of Goods which also include Transit Insurance Premium

6. MARINE INSURANCE MARKET IN INDIA  SALIENT FEATURES 1.Nationalisation of General Insurance Sector w.e.f. 01/01/1973 2.Alongwith GIC and Subsidiaries, certain State Insurance Funds were also allowed to carry out General Insurance Business 3.TAC introduced All India Marine Cargo Tariff on 31/03/1983 4.The Tariff was withdrawn w.e.f. 01/04/1994.Tea/Rubber/Cardamom/ Coffee Tariffs were withdrawn w.e.f. 01/04/2004 and Marine Hull Insurance was detariffed w.e.f. 01/04/2005 5.With the introduction of IRDA Act in 2000,private players were allowed to operate in the Indian Market and GIC was converted to National Reinsurer 6.The RI Programme is aimed at retaining maximum premium in the Indian Market through Obligatory Cession/Pools/Individual Retentions and InterCompany exchanges suitably protected by XL Treaties

7. INTERNATIONAL MARINE INSURANCE MARKET Marine Insurance is the most Global/International in character amongst all Commercial Insurances in the World Insurance Market Major International Marine Insurance Markets -- 1.United Kingdom 2.USA 3.France 4.Germany Emerging Markets--- 1.Switzerland 2.Bermuda 3.Asia 4.East and West Africa 5.Gulf and Middle-East countries

8. Insurance Market in U.K. The LONDON MARKET includes— 1.Lloyd’s 2.Other Major British Insurance Companies 3.Agencies and Branches of Foreign Insurers 4.Brokers/Risk Managers/Captive Managers 5.Mutual and Captive Insurance Companies 6.Trade Associations and Market Committee 7.Lawyers, Admirality Courts, Banks, Surveyors, Average Adjusters Other IMPORTANT ORGANISATIONS include- 1.Institute of London Underwriters 2.Salvage Association 3.International Union of Marine Insurance 4.International Maritime Bureau 5.International Underwriters Association of London

9. ORGANISATION OF LLOYD’S The Corporation of Lloyd’s is a premier world Insurance Market which had its origin in a small Coffee House of Edward Lloyd in Tower Street, London, in 1680 Lloyd’s Act,1871, gave Lloyds its legal status. The Lloyd’s Act of 1982, established a Council to manage and regulate the Society’s affairs. Lloyd’s ORGANISATION comprises of – 1.Syndicates=Group of Underwriting Members 2.L.P.S.O.=Lloyd’s Policy Signing Office 3.L.U.C.R.O.=Lloyd’s Underwriting and Claims Recovery Office 4.Lloyd’s Agents who provide Shipping Intelligence, carry out Survey Jobs for Ship/Cargo, act as Claim Settling Agents abroad 5.Lloyd’s Underwriters’ Association 6.Lloyd’s publications amongst which the important are -- Lloyd’s Register of Shipping Lloyd’s Shipping Index Lloyd’s List Lloyd’s Law Reports

10. OTHER IMPORTANT ORGANISATIONS  INTERNATIONAL UNDERWRITER’S ASSOCIATION OF LONDON( IUA) – is the World’s largest representative Organisation for International Insurance and Reinsurance Companies. It was formed on 31/12/1998 by the merger of London Insurance and Reinsurance Market Association (LIRMA) and the Institute of London Underwriters (ILU)  INTERNATIONAL UNION OF MARINE INSURANCE (IUMI)—works to safeguard and develop Insurer’s interests in Marine and Transport Insurance through cooperation of national markets on Marine issues, Marine Insurance and Technology and promoting quality Underwriting. It acts as a forum to exchange experience, information and statistical data on Marine Insurance matters and debate the challenges and opportunities facing Marine Insurers

11. OTHER IMPORTANT ORGANISATIONS..contd. INTERNATIONAL MARITIME BUREAU– is a non-profit Organisation established in 1981 to act as a focal point in the fight against all types of Maritime crimes/frauds/malpractices and suppression of piracy TARIFF ADVISORY COMMITTEE– was constituted under the provisions of the Insurance Act,1938.With the De-tariffing of the General Insurance Market w.e.f.01/01/2007,the TAC has since been abolished

12. OTHER IMPORTANT ORGANISATIONS …contd. GENERAL INSURANCE COUNCIL– is a statutory body under the Insurance Act,1938 and represents the collective interests of the Non-Life Companies in India and supports the operation of various Insurance related systems and mechanisms for the benefit of the member Companies GENERAL INSURANCE CORPORATION OF INDIA– was constituted vide the GIBNA,1972.The exclusive privilege of the GIC and four PSU Companies to transact General Insurance business was withdrawn by IRDA Act,1999.Today the GIC is known as GIC Re and functions as the national Reinsurer. The compulsory cession to GIC-Re is now 10%

13. Marine Insurance Basics

14. BASIC CONCEPTS Marine Insurance is essential to— 1.Overseas Trade 2.Inland Trade 3.Shipping Marine Insurance deals with— I.Insurance of Goods-in-Transit II.Insurance of Ships III.Insurance of Freight and Disbursements IV.Insurance of Offshore/Onshore Drilling Rigs

15. COLLATERAL SECURITY OF MARINE INSURANCE Normal Practice in Import/Export Trade IMPORTER to OPEN L/C with a Bank in F/O EXPORTER. Terms & Conditions of Insurance are specified in the L/C EXPORTER hands over B/E & other documents of Title to his Bank as & when goods are ready for shipment. Documents referred will include Bill of Exchange supported by Bill of Lading, Invoice, Packing Slip, Certificate of Origin and Insurance Cover Note/Policy COLLATERAL SECURITY--The Cargo Insurance policy will be issued keeping in mind that the Insurable Interest coincides with the Sale Contract. It may be noted that the above transaction is financially supported by an “irrevocable letter of credit” and hence once the documents are delivered by the Seller to his Bank, he may request his Bank to discount the Bill drawn in his favour by the buyer. Thus, the Seller would be assured of his proceeds. EXPORTER gets the Bills Discounted with his Bank. Henceforth the Risk is transferred to the Banker who insists on Insurance at the L/C Opening stage.Insurance on the Goods considered as PHYSICAL SECURITY for Bill Discounting The Shipping Documents are presented by the Exporter’s Bank to the Importer’s Bank which makes payment as per L/C Terms

16. STATUTES/REGULATIONS GOVERNING MARINE INSURANCE IN INDIA INSURANCE ACT-1938 AND INSURANCE REGULATIONS MARINE INSURANCE ACT,1963 STAMP ACT 1899 EXCHANGE CONTROL REGULATIONS RELATING TO INSURANCE IN INDIA MARINE HULL MANUAL VARIOUS STATUTES APPLICABLE TO CARRIERS/ BAILEES IN INDIA

17. IMPORTANT PROVISIONS APPLICABLE TO MARINE INSURANCE Marine Cargo and Hull Policies are agreed value policies whereas Duty and Increased Value Policies are pure Indemnity policies Marine Cargo policies are freely assignable Insurable Interest must be there at the time of loss Concept of General Average and Salvage Charges Stamp Duty recovered from the Insured Survey Fees initially payable by Insured/Consignor/Consignee and recoverable from the Insurer only if the claim is payable under the policy Marine Policy cannot be issued to Transport companies, Transport contractors, Freight forwarders or clearing/forwarding agents In the case of despatches by Private carriers or under special contracts where the carriers limit their liability, the company will pay 75% of the assessed loss.

18. PAYMENT OF PREMIUMS Section 64-VB of the INSURANCE ACT AND RULES 58 and 59 of the INSURANCE RULES are important. Rule 59 provides relaxation in case of marine cover notes, other than Hull, as follows- 1.Risk may be assumed under Open Policies for seasonal crops on payment of provisional premium based on a fair estimate of turnover 2.Risk may be assumed in case of exports subject to premium being paid within 15 days of sailing of vessel 3.Risk may be assumed in case of imports subject to premium being paid within 15 days of receipt of Decln.

19. MARINE INSURANCE ACT-1963— SALIENT FEATURES Codifies the Law relating to Marine Insurance in India and deals with the Law and Practice of Marine Insurance Provides Legal Framework for Marine Insurance Transactions - Cargo & Hull. The Act deals with :- I) Basic Principles II) Basis of Valuation III) Types of Losses & Settlement Basis IV) Extra Charges/Particular Charges etc. V) General Average & Salvage Charges

20. MARINE INSURANCE ACT,1963- SALIENT FEATURES ……contd.  Two implied warranties under M. I. Act –seaworthiness and cargo-worthiness of vessel and legality of the object of the marine adventure As per the M.I. Act, assured must have Insurable Interest in the Subject Matter of Insurance at the time of loss Lost or Not-Lost provision is special to Marine Cargo Insurance ASSIGNMENT of Marine Cargo Policies- a marine cargo policy is freely assignable, unless expressly prohibited for e.g. Duty Policy/Increased Value policy/Sellers Contingency Policy/Open policy/Annual Policy/SSRI Policy. Marine Cargo Policy may be assigned either before or after the loss

21. FUNDAMENTAL PRINCIPLES IN MARINE INSURANCE UTMOST GOOD FAITH—Sections 19-23 of the M.I. Act deal with the Principle of Utmost Good Faith and Sections 35-43 of the Act deal with Warranties. All Marine Insurance Contracts are contracts of Utmost Good Faith INSURABLE INTEREST— Sections 6-17 of the M. I. Act deal with the Principle of Insurable Interest. In Marine Cargo Insurance,the Assured is not required to have Insurable Interest when the Insurance is effected but he must have a reasonable expectation of acquiring the Interest and must have an interest at the time of loss/claiming the loss. Sections 52 & 53 deal with assignment of policy. Marine Cargo policies are freely assignable INDEMNITY-- Section 3 of the M. I. Act deals with Indemnity. Marine Cargo and Hull policies are Agreed Value policies. Values keep fluctuating and Cargo appreciates in value as it gets closer to the destination. The permissible limits of agreed value in Cargo is CIF+10% and Hull Insurance is normally transacted on the basis of Valuation Certificate issued by Competent Authority

22. FUNDAMENTAL PRINCIPLES IN MARINE INSURANCE..contd. In Marine Insurance, valued policies are invariably used, except for Insurance of Freight, Disbursements, Customs Duty on Imports and similar interests wherein Unvalued policies are issued. In case of fraud, the valuation may be reopened An unvalued policy does not specify the value of the Subject Matter insured, but subject to the limit of the Sum Insured, leaves the Insurable Value to be subsequently ascertained SUBROGATION– In Marine Cargo Insurance, recoveries under Subrogation are against Carriers. In Marine Insurance, there is also the concept of Abandonment. The difference between Subrogation and Abandonment is that in Subrogation there is only transfer of Rights and Remedies whereas in Abandonment, there is transfer of Proprietary Rights CONTRIBUTION--- the Principle of Contribution applies to Marine Insurance contracts

23. FUNDAMENTAL PRINCIPLES IN MARINE INSURANCE  The Principle of Proximate Cause applies to Marine Insurance Contracts. In fact, most of the decided case laws on Proximate Cause (Causa Proxima) are from Marine Insurance. The important and interesting case laws are discussed below-  Samual V/S Dumas (1924)– Ship was deliberately scuttled with the connivance of the Owner. Innocent Mortgagee pleaded incursion of Sea-water---peril of the sea as the proximate cause. Court held the Proximate Cause to be Wilful Misconduct of the Insured.  Leyland Shipping V/S Norwich Union (1918)--- Vessel Ikeria- a Merchant Vessel was torpedoed by a German Submarine during WW-I. She took shelter in the port of Havre. A storm/gale sprang up and since it was in great danger of sinking alongside the quay, it was ordered to shift to an outer berth where unfortunately because of the rise and fall of the tides, the vessel broke up and sank. Ikeria was insured for marine risks only and War Risks were not covered. The Court held that the proximate cause was torpedoing-a war peril as the vessel was never out of danger from the time she was hit by torpedo.

24. SCOPE OF MARINE INSURANCE MARINE INSURANCE comprises Insurance of – 1. CARGO 2. HULL 3.FREIGHT AND DISBURSEMENTS 4. BUILDERS RISK

25. CARGO INSURANCE

26. SCOPE OF MARINE CARGO INSURANCE CARGO INSURANCE provides Insurance cover for Loss/Damage to goods during transit by Rail/Road/Air/Ocean/Post (Regd). It deals with- A.EXPORT/IMPORT B.COASTAL SHIPMENTS C.SHIPMENTS BY SAILING VESSELS/ INLAND VESSELS D. INLAND TRANSIT BY RAIL/ROAD/AIR E. REGISTERED POST PARCEL F.COURIERS

27. MARINE RATING & UNDERWRITING Five PRINCIPAL FACTORS are involved in CARGO rating. They are- 1.Nature of Cargo 2.Type of Packing 3.Vessel-GRT/Liner or Tramp/classed or otherwise/ FOC/ overage. Extras charged for overage/undertonnage/FOC/ non-classification 4.Voyage- different modes of carriage involved/ intermittent storages and their duration/stowage-underdeck or overdeck/loading and unloading/no. of transhipments en-route/climatic conditions etc. 5.Insurance cover required

28. SALIENT FEATURES OF MARINE CARGO UNDERWRITING  Normally, in single transits, the details of Insured/ Cargo/Packing/ Carrier/Journey/mode of conveyance /terms of Insurance cover, etc. are submitted through a Declaration Form. Proposal Forms are used in Open Declaration/ Annual/ STOP/SSRI policies  Underwriting Factors in Marine Cargo Insurance are--- 1.Vessel 2.Voyage 3.Nature of Cargo and type of Packing 4.Details of Carrier/Shipment 5.Terms and Conditions of Insurance

29. UNDERWRITING FACTOR---VESSEL  Physical condition of the vessel is frequently a reflection of its age  The vessel must be sea-worthy and cargo-worthy  Proper maintenance and sound Management of the vessel have a bearing on the ability to withstand the diverse hazards during voyage/navigation  Size of the vessel is important. Vessels below 5000 GRT may not be able to withstand stormy seas and cyclonic weather  Liners should be preferred over Tramp Vessels and Chartered Vessels  Vessel Classification by reputed Classification Societies and maintenace of Class is a desirable Underwriting feature  Age of the Vessel is important. Tankers above 10yrs.,Liners above25 yrs., vessels other than Liners above 15 yrs. and Container Vessels above 30 yrs. age are generally not accepted or accepted by charging overage extra  Carriage of Cargo by FOC(Flag of Convenience) Vessels is normally a declined Risk

30. Accidents to Ship/Cargo

32. Accidents to Cargo

33. UNDERWRITING FACTOR---VOYAGE  Except for War Risks, the cover granted by ICC-A/B/C is from ‘warehouse-to-warehouse’  The important checkpoints during transit/ handling/ incidental storage are as follows- 1.Storage and handling facilities at the container terminals and transit sheds in the port premises 2.Whether there will be direct quayside loading into the carrying vessels or lighterage operations are involved 3.Stowage in the Vessel and whether underdeck or overdeck is an important factor 4.Duration of Voyage, ports of call,number of transhipments, weather conditions en-route will play an important role 5.Unloading and storage facilities and labour conditions at Destination Port will also need to be considered

34. Cargo loading/unloading

35. UNDERWRITING FACTOR—NATURE OF CARGO  Susceptibility to damage due to various causes will depend upon the nature of cargo. Inherent Vice, ordinary leakage/breakage are standard exclusions under all the Clauses. Spontaneous Combustion risks are covered under Institute Coal Clauses but not under ICC Clauses  Cargoes which contain excess Humidity when shipped, are susceptible to heating and spontaneous combustion eg.jute fibres and cotton in IBFP Bales  Refined Spirits evaporate and some cargo like for eg. salt,sugar, sulphur, nitrates have chemical affinities with various commodities  Some Commodities like grain may gain weight during transit and some may lose weight by evaporation of their moisture content. Some Cargo are susceptible to fermentation/caking/crystallisation  Certain Cargo eg. oranges, lemons, cloves,cheese are odorous/ aromatic, some are susceptible to taint damage and others are deliquescent (absorb moisture ).Inflammable Cargo like naphtha needs special loading/unloading facilities

36. UNDERWRITING FACTOR-- PACKING  Improper/Insufficient/Inadequate/Unsuitable and Defective packing may turn a small loss into a large one. ICC-A/B/C Clauses specifically exclude such a contingency. Loss/Damage due to faulty stowage by the Insured in the Container is also excluded  Customary or Standard Packing approved by the Indian Packaging Institute is preferred  Different types of Packing are adopted for specified commodities.Eg.- I.Corrugated Boxes/Cartons for consumable goods, computers etc. II.Wooden Boxes/Cases for machines, industrial equiments III.Polythene lined Jute Bags are used for chemicals, multi-ply paper bags for cement and chemicals in granules or powder form, etc. IV.Iron-bound Fully Pressed (IBFP) Bales are used for Cotton/Wool V.Palletisation /Unitisation of Cargo result in better Turnover during loading/unloading and extra safety during Cargo handling/stowage

37. UNDERWRITING FACTOR– PACKING..contd. VI. Containers/Liftvans are a wider application of the concept of Unitisation. A container is not only a means of Transport but a mode of carriage and facilitates intermodal carriage.ISO Standard specifies the standard dimensions for containers as 8.5 feet height X 8 feet width and the length may be 10/20/30/40 feet and the Standard Measure is TEU—Twenty Foot Equivalent Unit VII.FCL and LCL Containers are used by Consignors depending upon full or part Container load. Consolidation of Cargo in LCL Containers is normally carried out by specialised Agencies/Freight- forwarders at Inland Container Depots(ICD) VIII. Specialised Containers such as Open Top, Bullet-type, Reefer, etc. are provided for specific Cargo on demand IX.Bulk Cargo—is Cargo carried either as full load in Vessels or even Containers without any packing. Fertilizers, Cement,Grain,Sugar, Liquids,Ore are normally shipped in Bulk.LPG/LNG/Crude are sent in specialised LNG/LPG Carriers/VLCC/ULCC

38. Cargo Losses/Bad Stowage& Stuffing

39. Cargo losses

40. CONTAINERISATION IN CARGO Essentially, Containerisation is a Mode of Carriage. Containerisation may be described as stuffing of goods in containers and their transportation Though container cannot be treated as a substitute for packing, it may enable the shipper to minimise handling risks and economise on the Packing. This may be possible when it is a full container load(FCL) (Shipper-to-consignee) shipment In the case of less than container load(LCL), however economy on packing may result in serious losses. Even for door to door shipments, the packing must be sufficiently strong to be able to withstand the horizontal and vertical pressures and concussions to be met with during transit by rail, road or by sea

41. CONTAINERISATION IN CARGO..contd. The first Containers were mostly of the size 8½x8x20 and this is taken as unit for capacity rackoning. Thus, an 8½x8x40 container is reckoned as 2TEUs and so on. The characteristics of a container are enumerated below: A container is a mode of transport and an equipment of permanent character capable of withstanding the rigours of transit and frequent usage. They are constructed of various material such as aluminium/ steel/ stainless steel depending upon the type of cargo to be carried. They are provided with devices like hooks or clamps for easy loading and unloading operation and also for securing them during transportation.They are constructed so as to facilitate easy stuffing and destuffing.

42. CONTAINER SHIPS

43. TYPES OF CONTAINERS There are several types of containers designed to carry general cargo and specialised cargo like perishables, liquids etc. Some of the types are described below:- CLOSED CONTAINERS: These are the most frequently used containers for stuffing general cargo packed in cases, bags, cartons, etc. REEFER CONTAINERS: These are used for carrying perishables under certain controlled temperature limits. The container itself is refrigerated and can be carried in an ordinary vessel by plugging into its main supply. Such containers are used to carry marine products, frozen meat, medicines, poultry, photo films or goods of similar nature which are to be kept at certain temperature levels. TANK CONTAINERS: These are used for carrying liquid cargo like chemicals and are specially lined inside to prevent corrosion

44. INSURANCE OF CONTAINERS Overseas Transit of Containers– Containers are insured subject to Institute Container Clauses which broadly cover- 1.All Risk of Loss/Damage to Container 2.General Average/Salvage Charges incurred to avoid a loss due to insured perils 3.Loss/Damage to Container Machinery due to— TL/CTL of Container/ GA Sacrifice Fire/Explosion due to external causes Vessel/Craft being stranded/grounded/sunk/capsized Overturning/derailment/accidents to land conveyance/aircraft Collision/Contact of Vessel/craft with any external object, other than water

45. INSURANCE OF CONTAINERS…contd. Inland Transit of Containers– Containers are treated like Cargo and insured under ITC ‘B’ Clause. Policy may be extended to cover storage on a weekly basis covering the containers while awaiting stuffing at the exporter’s premises. Policies are normally taken in joint names of Exporters and Shipping Company Insurance may be granted to containers issued to shipping agents or to consignors/ consignees on lease during their onward journey from a port to notified warehouse, storage thereat as also their return journey to the port subject to Inland Transit (Rail/Road) Clause ‘B’ only. The minimum rate of premium for annual cover is 30 times the single journey rate. Additional perils like theft, pilferage and non-delivery, rain and fresh water damage, breakage, leakage, SRCC may also be covered singly or jointly by charging additional specific premium towards such inclusion.

46. CONDITIONS OF INSURANCE  The Clauses applicable will decide the conditions of Insurance and appropriate premium will have to be charged depending upon the scope of cover  The base premium will apply for ICC-C coverage and each progressive stage of rating for the widening scope of cover should then supplement that base so as to produce a composite rate keeping in mind all the material components of the Risk  When extraneous covers are sought under ICC-B, additional premium will depend upon the commodity vis-à-vis the cover solicited  The cover under ICC-A Clause is very wide as the coverage is defined by exclusions i.e. all perils / contingencies are covered other than exclusions

47. INCIDENTAL CLAUSES AND WARRANTIES Comprehensive Clause--- covers various Extraneous Perils like TPND/FWD/RWD/HOOK/ OIL/MUD/ ACID/ HEATING/SWEATING/DAMAGE BY OTHER CARGO Institute Replacement Clause– is specifically attached where new machinery is Insured and limits the Liability of the Insurers, in case of damage to parts, to the cost of repairing/ replacing the damaged part plus forwarding and refitting charges Second Hand Replacement Clause– is attached where old /second hand machinery is Insured and limits the liability to the depreciated value in case of TL/CTL cases and pays on new-for-old basis in damage claims Pair and Sets Clause-- limits the liability of the Insurer to the Insured Value of the lost/damaged part without reference to any special value attaching to it as part of such pair or set Cutting Clause--- is incorporated where pipes etc. are insured. The clause limits the liability of the Insurer to the proportionate insured value of the damaged part cut off and the cost of cutting

48. INCIDENTAL CLAUSES AND WARRANTIES….contd. Label Clause– limits the liability of the Insurer in respect of canned/bottled goods where the labels are discoloured / torn-off to the cost of re-labelling and repacking the affected goods Brand & Trade Marks Clause– is incorporated to prevent inferior quality or damaged goods being sold as salvage in the market to the detriment of the Insured’s reputation and to avoid potential product liability claims. If the damaged goods are sold as salvage, the brand/ trademark is removed. Alternatively, the Insured may offer reasonable salvage value and destroy the goods Concealed Damage Clause--- sometimes a long time is taken by the consignee after delivery to open the goods for inspection/use and the loss is noticed only at that time. The Clause allows a time limit for delayed opening and notifying the loss to Insurers Debris Removal Clause – covers the cost of removal of debris subject to limits

49. INCIDENTAL CLAUSES AND WARRANTIES….contd. Picking Clause--- is applicable to cotton, wool and similar fibrous commodities which are shipped in bales. By applying this clause, country damage is restricted to the outer surface and the clause will pay the cost of picking out the damaged fibres and re-baling/ consolidating the sound portion as well as damaged portion ( which can be sold in the market as salvage) Garbling Clause--- is applicable to policies covering tobacco/coffee beans/grain etc. wherein loss/damage due to contamination is likely. Garble means to sift, cleanse, separate sound from the contaminated/ mixed-up cargo and prevents further damage/deterioration Institute C lassification C lause---- specifies that the vessel carrying the cargo must be classified by any of the Classification Societies which are members/associate members of the International Association of Classification Societies (IACS) Car go ISM Endorsement deals with Safety aspects and insists that the vessel should comply with the ISM Code

50. CONTRACTS OF SALE SALES in India are governed by Sale of Goods Act-1924. International Chambers of Commerce formulated the INCO TERMS which are commonly applied internationally. WHO is responsible for effecting Insurance on Goods will depend upon the SALE CONTRACT. PRINCIPLE TYPES of Sale Contracts are:- 1.Ex-Works –Seller’s responsibility ends at factory gate 2.FOR/FREE CARRIER-Seller liable to place goods on rail/road carrier 3.FAS-seller liable to place goods alongside ship 4.FOB-seller liable to place goods on board ship(over the ship’s rail) 5.DES--Delivery ex-ship-seller liable to deliver goods at destination port 6.C+F- complementary to FOB. Buyer liable from the time the goods are placed on board ship 7.CIF-seller is liable warehouse-to warehouse. He may recover the Insurance and Freight charges from the Buyer, if the Contract permits 8.DDP—Seller has to deliver to Buyer duty paid at his warehouse 9. DAT---Seller has to deliver at Cargo terminal

51. CONTRACTS OF SALE--ILLUSTRATION DischargePort C & F FOBLoadPort Ex Factory Ex Works DDP/DATFactory Works Works DES CIF

52. MARINE CARGO CLAUSES The Institute Cargo Clauses are drafted by the Technical Clauses Committee of the Institute of London Underwriters(now called Institute of Underwriters Association of London) and the clauses define the Scope of Cover and Terms & Conditions of Insurance. They primarily deal with the following aspects :- * Risks Covered * Exclusions * Duration * Insurable Interest * Change of Voyage * Forwarding Charges * Minimizing Losses * Reasonable Despatch * Termination of Contract of Carriage * Constructive Total Loss

53. ICC-A/B/C  ICC-C ------- RISKS COVERED LOSS/DAMAGE REASONABLY ATTRIBUTABLE TO: FIRE OR EXPLOSION 1.1.1 VESSEL/CRAFT BEING STRANDED/ 1.1.2. GROUNDED/SUNK/CAPSIZED OVERTURNING/DERAILMENT OF 1.1.3. LAND CONVEYANCE COLLISION/CONTACT OF VESSEL/ 1.1.4. CRAFT/CONVEYANCE WITH ANY EXTERNAL OBJECT( OTHER THAN WATER ) DISCHARGE OF CARGO AT A PORT OF DISTRESS 1.1.5. LOSS/DAMAGE CAUSED BY: GENERAL AVERAGE SACRIFICE 1.2.1. JETTISON 1.2.2. GENERAL AVERAGE CONTRIBUTION AND SALVAGE CHARGES INCURRED TO AVOID/MINIMISE LOSS/DAMAGE DUE TO INSURED PERILS Liability under BOTH-TO-BLAME Collision Clause

54. ICC-A/B/C Terms illustrated

55. ICC—A/B/C…….contd.  ICC—B-------RISKS COVERED This Clause covers LOSS OR DAMAGE CAUSED BY all the perils as per 1CC-C Clause and also the following perils: E.Q./VOLCANIC ERUPTION/LIGHTNING 1.1.6.* WASHING OVERBOARD 1.2.2.* ENTRY OF SEA/LAKE /RIVER WATER 1.2.3.* INTO VESSEL/CRAFT/HOLD/CONVEYANCE/ CONTAINER/LIFTVAN/PLACE OF STORAGE TOTAL LOSS OF ANY PACKAGE LOST 1.3* OVERBOARD WHILST LOADING ONTO/ UNLOADING FROM VESSEL/CRAFT (SLING LOSS)  ICC— A-------RISKS COVERED ICC—A--COVERS ALL RISKS OF LOSS/DAMAGE TO THE INSURED SUBJECT MATTER (EXCEPT EXCLUSIONS )

56. Comparison between ICC-C/B ICC B--COVERAGE loss of or damage to the subject-matter insured reasonably attributable to: 1.1.1 fire or explosion 1.1.2 vessel or craft being stranded, grounded, sunk or capsized 1.1.3 overturning or derailment of land conveyance 1.1.4 collision or contact of vessel, craft or conveyance with any external object other than water 1.1.5 discharge of cargo at a port of distress 1.1.6 earthquake, volcanic eruption or lightning loss of or damage to the subject-matter insured caused by: 1.2.1 general average sacrifice 1.2.2 jettison or washing overboard 1.2.3 entry of sea, lake or river water into vessel, craft, hold, conveyance, container, liftvan or place of storage 1.3 total loss of any package lost overboard or dropped whilst loading on to, or unloading from, vessel or craft

57. Meaning of Reasonably Attributable to explained with Case Studies Example one The cargo is in a storage shed at an intermediate place on the insured transit. A fire in part of the shed causes the roof to collapse, damaging the cargo. The cargo itself is not touched by the fire. The damage to the cargo is thus not caused by fire but is reasonably attributable to the fire. Example two An earthquake beneath the seabed causes a tidal wave that rolls for a hundred kilometres across the sea. The vessel on which the insured cargo is stowed is tossed violently on the wave, causing the stow to collapse, damaging the cargo. The damage is not caused by the earthquake but is reasonably attributable to it. Example three The railway wagon carrying the insured cargo is derailed. There is no damage to the cargo from the derailment. The cargo has to be transferred to a lorry to continue its transit to the port. Some of the cargo is stolen while being transferred from the derailed train to the lorry. This is a loss by theft which is not one of the perils insured against under B or C clauses. However, it is reasonable to attribute the theft to the derailment of the train and the Assured should therefore recover the loss

58. ICC-A/B/C-----contd. BOTH TO BLAME COLLISION CLAUSE EXPLAINED 1.AS PER ONE OF THE CONDITIONS OF THE BILL OF LADING, IN THE EVENT OF COLLISION WITH ANOTHER VESSEL,CARGO OWNERS CANNOT CLAIM DAMAGES FROM THE CARRYING VESSEL.THEY MUST NECESSARILY PROCEED AGAINST THE NON-CARRYING VESSEL. 2.UNDER MARITIME LAW OF CERTAIN COUNTRIES,INCLUDING USA,THE APPORTIONMENT OF BLAME FOR COLLISION IS 50: 50 3.WHEN THE APPORTIONMENT IS DONE ON 50:50 BASIS AS PER BOTH –TO –BLAME COLLISION CLAUSE,THE CARRYING VESSEL MAY END UP PAYING 50% OF THE DAMAGES OF THE CARGO CARRIED BY IT. 4.THE CARGO-OWNERS ARE LIABLE UNDER THE B-T-B COLLISION CLAUSE TO INDEMNIFY THE SHIPOWNER FOR ANY AMOUNT WHICH THE CARRYING VESSEL IS REQUIRED TO CONTRIBUTE TOWARDS DAMAGES TO THE CARGO CARRIED BY IT. 5.THE BOTH-TO-BLAME COLLISION CLAUSE IN THE ICC—A/B/C PROVIDES THAT THE INSURER WILL INDEMNIFY THE INSURED CARGO –OWNER AS AND WHEN ANY CLAIM IS LODGED ON THEM BY THE SHIPOWNER INVOKING THE BOTH-TO-BLAME COLLISION CLAUSE OF THE BILL OF LADING ISSUED BY THEM.

59. ICC-A/B/C….contd. EXCLUSIONS:  GENERAL EXCLUSIONS- 4 1.WILFUL MISCONDUCT OF THE INSURED 4.1 2.ORDINARY LEAKAGE/LOSS IN WEIGHT OR 4.2 VOLUME/WEAR AND TEAR OF SUBJECT MATTER 3. INSUFFICIENCY/UNSUITABILITY OF 4.3 PACKING OR PREPARATION OF SUBJECT MATTER PACKING INCLUDES STOWAGE IN CONTAINER/LIFTVAN BUT ONLY WHEN –  SUCH STOWAGE IS CARRIED OUT PRIOR TO ATTACHMENT OF RISK OR  BY THE ASSURED/THEIR SERVANTS  INHERENT VICE OR NATURE OF THE SUBJECT MATTER INSURED 4.4  PROXIMATELY CAUSED BY DELAY(EVENTHOUGH 4.5 DELAY BE CAUSED BY AN INSURED PERIL)  INSOLVENCY OR FINANCIAL DEFAULT OF OWNERS 4.6 MANAGERS/ CHARTERERS/OPERATORS OF VESSEL  NUCLEAR WEAPONS MATERIAL/RADIOACTIVE 4.7 CONTAMINATION

60. Case Study Cargo: Medicines with SI= Rs.50 Lakhs Incident: Truck is intercepted and high value medicines worth Rs.34 Lakhs stolen by the culprits Investigation revealed that this was the 3 rd similar incident in 6 months and an Employee of the Insured was a party in these incidents of Theft Coverage: ITC-A AND SRCC Point for Consideration: Can the claim be repudiated invoking WILLFUL MISCONDUCT OF THE INSURED

61. Case Study Cargo: Onions in Bags in FCL Containers--- Warehouse –to—Warehouse Voyage: Vizag to Klang, Kuala Lumpur Incident: Cargo reached Destination in rotten condition Coverage: ICC-A,WAR AND SRCC Cause of Loss: The Containers selected by the Insured did not have any ventilation Question 1: Can the claim be repudiated invoking exclusion 4.3 Question 2: What if the Cargo had been sent as LCL by the Insured and Stuffing done at the ICD by the Multimodal Carrier

62. Case Study A vessel is badly damaged by heavy weather (an insured peril under an ‘All Risks’ policy) and has to put into a port of refuge for repairs A perishable cargo on board decays as a result of the delay The proximate cause of loss to the perishable cargo is the delay, not the heavy weather Is the claim for decay payable?

63. ICC—A/B/C…..contd. ICC—B/C contain ONE additional GENERAL EXCLUSION as follows:- DELIBERATE DAMAGE TO/DESTRUCTION OF SUBJECT MATTER BY WRONGFUL ACT OF ANY PERSON…ie…MALICIOUS DAMAGE 4.7 UNSEAWORTHINESS/UNFITNESS EXCLUSION 5.1/5.2 (LOSS/DAMAGE/EXPENSE ARISING FROM UNSEAWORTHINESS OF VESSEL/CRAFT OR UNFITNESS OF VESSEL/CRAFT/CONVEYANCE/ CONTAINER FOR SAFE CARRIAGE OF SUBJECT MATTER UNLESS THE ASSURED/SERVANTS/ASSIGNEE ARE PRIVY TO SUCH UNSEAWORTHINESS/UNFITNESS) WAR EXCLUSION 6.1—6.3 (WAR PERILS CAN BE COVERED AT EXTRA PREMIUM) STRIKE/RIOT/CIVIL COMMOTION EXCLUSION 7.1----7.3 (SRCC PERILS CAN BE COVERED AT EXTRA PREMIUM)

64. ICC-A/B/C------contd. DURATION- comprises TRANSIT CLAUSE………8.1-8.3 TERMINATION OF CONTRACT OF CARRIAGE CLAUSE………..9.1/9.2 CHANGE OF VOYAGE CLAUSE…………….10 TRANSIT CLAUSE INSURANCE ATTACHES FROM THE TIME OF SHIFTING OF CORGO/GOODS FOR COMMENCEMENT OF TRANSIT AT THE CONSIGNOR’S WAREHOUSE /PLACE OF STORAGE CONTINUES DURING THE ORDINARY COURSE OF TRANSIT AND TERMINATES ON--  UNLOADING /DELIVERY OF CARGO TO THE FINAL WAREHOUSE AT DESTINATION OR  DELIVERY TO ANY OTHER W/HOUSE PRIOR TO OR AT DESTINATION FOR STORAGE/ ALLOCATION/DISTRIBUTION AS ELECTED/CHOSEN BY THE INSURED OR  EXPIRY OF 60 DAYS AFTER COMPLETION OF DISCHARGE OVERSIDE OF GOODS FROM OVERSEAS VESSEL AT DESTINATION PORT -----WHICHEVER SHALL FIRST OCCUR

65. Case Study Cargo: Spark Plugs Coverage: ITC-A AND SRCC Incident: Night Shift loads lorry at the Consigner’s Warehouse and the Driver removes the Truck to the common parking lot in the Industrial cluster outside the factory gate and goes Home. After night sleep when he comes in the morning to take the lorry to the Docks, the tarpaulin is found to be cut and 5 cartons of Spark Plugs stolen Question: Has the Transit commenced?

66. Case Study Cargo: Television Sets Coverage: ITC-A AND SRCC Incident: Truck carrying the Cargo arrives at the Consignee’s Warehouse late night on a Sunday and since the Shift Duty Labour had left for the day, unloading of the packages could not be done. On Sunday night there was a major Fire at the Consignees Warehouse in which the truck and the Cargo of T. V. Sets was also damaged Question: Has the Cargo been delivered? Is the claim tenable under the policy?

67. ICC—A/B/C…..contd. IF AFTER DISCHARGE FROM OVERSEAS VESSEL AT THE FINAL PORT OF DISCHARGE,BUT PRIOR TO TERMINATION OF THE INSURANCE,THE GOODS ARE TO BE FORWARDED TO A DESTINATION OTHER THAN THE INSURED,THE INSURANCE WILL NOT EXTEND BEYOND THE COMMENCEMENT OF TRANSIT TO SUCH OTHER DESTINATION………………………………………………...8.2 THE INSURANCE WILL REMAIN IN FORCE DURING  DELAY BEYOND THE CONTROL OF THE ASSURED  ANY DEVIATION/ FORCED DISCHARGE /RESHIPMENT/ TRANSHIPMENT  VARIATION OF ADVENTURE ARISING FROM EXERCISE OF LIBERTY GRANTED TO CARRIER UNDER CONTRACT OF AFFREIGHTMENT………………………………………8.3 (THESE PERILS ARE NORMALLY COVERED WITHOUT CHARGING ADDITIONAL PREMIUM )

68. ICC—A/B/C…contd. TERMINATION OF CONTRACT OF CARRIAGE….9 IF OWING TO CIRCUMSTANCES BEYOND THE CONTROL OF THE ASSURED EITHER-  THE CONTRACT OF CARRIAGE IS TERMINATED AT A PORT/PLACE OTHER THAN THE NAMED DESTINATION OR  THE TRANSIT IS TERMINATED BEFORE DELIVERY OF THE GOODS as provided for in CLAUSE 8 --THE INSURANCE WILL ALSO TERMINATE unless prompt notice is given and additional premium is paid,if required, IN WHICH CASE THE INSURANCE WILL REMAIN IN FORCE EITHER:-  UNTIL THE GOODS ARE DELIVERED AND SOLD AT SUCH PORT/PLACE OR UNTIL THE EXPIRY OF 60 DAYS AFTER ARRIVAL OF THE GOODS AT SUCH PORT/PLACE,WHICHEVER SHALL FIRST OCCUR ……………..9.1 OR  IF THE GOODS ARE FORWARDED WITHIN THE 60 DAYS PERIOD TO THE NAMED OR ANY OTHER DESTINATION,UNTIL TERMINATED IN ACCORDANCE WITH THE PROVISIONS OF CLAUSE 8…………………9.2 CHANGE OF VOYAGE………………………………………10 (IS HELD COVERED AT A/P AND PROMPT NOTICE)

69. ICC—A/B/C……contd. CLAIMS comprises:  INSURABLE INTEREST CLAUSE…………11.1/11.2  FORWARDING CHARGES CLAUSE………………12  CONSTUCTIVE TOTAL LOSS CLAUSE……….13  INCREASED VALUE CLAUSE………14.1/14.2 INSURABLE INTEREST  THE ASSURED MUST HAVE INSURABLE INTEREST AT THE TIME OF LOSS  LOST OR NOT LOST PROVISION according to which Assured can recover a loss due to the Insured Perils occurring during the policy period and notwithstanding that loss occurred before the Insurance Contract was concluded, unless the Assured was aware of the loss and the Underwriter was NOT.

70. ICC-A/B/C….contd. FORWARDING CHARGES……….12  WHERE,AS A RESULT OF THE OPERATION OF AN INSURED PERIL,THE TRANSIT IS TERMINATED AT A PORT/PLACE OTHER THAN NAMED,THE U/W WILL REIMBURSE THE INSURED ANY EXTRA CHARGES INCURRED IN UNLOADING/STORING/ FORWARDING THE GOODS TO THE NAMED DESTINATION  THIS CLAUSE WILL NOT APPLY TO G/A AND S/C.IT WILL NOT INCLUDE CHARGES ARISING FROM FAULT/ NEGLIGENCE/INSOLVENCY/ FINANCIAL DEFAULT OF INSURED CONSTRUCTIVE TOTAL LOSS………13 TO RECOVER A CLAIM FOR CTL,THE SUBJECT MATTER MUST BE REASONABLY ABANDONED EITHER DUE TO :  AN ACTUAL TOTAL LOSS APPEARING UNAVOIDABLE OR  COST OF RECOVERING/ RECONDITIONING/FORWARDING TO DESTINATION WOULD EXCEED VALUE ON ARRIVAL

71. ICC-A/B/C….contd. INCREASED VALUE……………14  IF INCREASED VALUE INSURANCE IS EFFECTED ON THE INSURED CARGO THE TOTAL S/I WILL BE DEEMED TO BE THE CARGO S/I+THE INCREASED VALUE.  IF THE S/I UNDER THE POLICY IS LESS THAN THE S/I+I/V,THE LOSS WILL BE SETTLED PROPORTIONATELY.(ie THE INSURANCE BECOMES PURE INDEMNITY) ASSURED MUST PROVIDE EVIDENCE OF AMOUNTS UNDER ALL OTHER INSURANCES BENEFIT OF INSURANCE….15 THE INSURANCE WILL NOT INURE TO THE BENEFIT OF CARRIERS/BAILEES MINIMISING LOSSES………16/17 DUTY OF ASSURED/WAIVER INSURED IS DUTYBOUND TO TAKE LOSS MINIMISATION MEASURES AND PROTECT RECOVERY RIGHTS REASONABLE DESPATCH CLAUSE……………..18 ENGLISH LAW AND PRACTICE CLAUSE…..19

72. Case Study Cargo: Ceiling Fans in Domestic Transit Incident: Rainwater damages the outer packaging. However, there is no damage to the Cargo Coverage: ITC-A AND SRCC Claim for Loss: Insured Claims re-packing costs equivalent to 30% of Sum Insured Question: Can the claim for re-packing be allowed when Cargo is not damaged?

73. INSTITUTE CARGO CLAUSE-AIR THE INSURANCE COVERS ALL RISKS OF LOSS/DAMAGE TO THE SUBJECT MATTER THERE ARE ONLY THREE TYPES OF EXCLUSIONS:- GENERAL/WAR/STRIKE EXCLUSIONS (UNSEAWORTHINESS /UNFITNESS EXCLUSION IS NOT THERE) EXCLUSION 2.7 DEALS WITH FINANCIAL DEFAULT OF AIRCRAFT OWNERS/MANAGERS/ CHARTERERS/ OPERATORS TRANSIT CLAUSE MODIFIED—LIMITATION CLAUSE (6.3)SPECIFIES A PERIOD OF 30 DAYS AFTER UNLOADING FROM THE AIRCRAFT AT THE FINAL PLACE OF DISCHARGE CLAUSES 6.2,6.3,7.1,7.2 and 8 HAVE BEEN MODIFIED TO FALL IN LINE

74. INSTITUTE STRIKES CLAUSES--CARGO SALIENT FEATURES:- 1.EXCLUSIONS 7.1 AND 7.3 OF ICC-A/B/C ARE COVERED AS RISKS UNDER CLAUSES 1.1 AND 1.2 BUT EXCLUSION 7.2 OF ICC-A/B/C (LOSS/DAMAGE/EXPENSE RESULTING FROM STRIKES/LOCKOUTS/LABOUR DISTURBANCES/RIOTS/CIVIL COMMOTION)IS STILL NOT COVERED 2.A NEW EXCLUSION(3.7),BESIDES THE REGULAR EXCLUSIONS OF ICC-A/B/C,IS INCORPORATED WHICH EXCLUDES LOSS/DAMAGE/EXPENSE ARISING FROM THE ABSENCE/SHORTAGE/WITHOLDING OF LABOUR DUE TO STRIKES/LOCKOUTS/LABOUR DISTURBANCES/RIOTS/CIVIL COMMOTION 3.THE DURATION CLAUSE AND THE OTHER CLAUSES FOLLOW THE WORDING OF ICC-A/B/C 4.TERMINATION OF TRANSIT(TERRORISM CLAUSE) SPECIFICALLY INTRODUCED AFTER 9/11 ATTACK WHICH WITHDRAWS TERRORISM COVER AT STORAGE PLACES

75. INSTITUTE WAR CLAUSES--CARGO SALIENT ASPECTS:- TECHNICALLY THIS CLAUSE SHOULD COVER ALL THE PERILS EXCLUDED BY THE WAR EXCLUSION CLAUSE OF ICC— A/B/C(6).HOWEVER (6.2) EXCLUDES CAPTURE/SEIZURE/ARREST/ RESTRAINT/DETAINMENT DUE TO ANY CAUSE(ICC-A COVERS PIRACY )BUT (1.2)OF IWC COVERS CAPTURE/SEIZURE/ARREST /RESTRAINT/DETAINMENT ARISING FROM WAR PERILS ONLY(1.1 OF IWC) A NEW EXCLUSION(3.7),BESIDES THE REGULAR EXCLUSIONS OF ICC- A/B/C,IS INCORPORATED WHICH EXCLUDES ANY CLAIM BASED UPON LOSS OF OR FRUSTRATION OF VOYAGE/ADVENTURE NUCLEAR WEAPONS/RADIOACTIVE CONTAMINATION IS STILL EXCLUDED DURATION CLAUSE IS MODIFIED TO FALL IN LINE WITH THE WATERBORNE AGREEMENT- 1.CARGO IS COVERED ONLY WHEN IT IS WATERBORNE.COVER CEASES ON DISCHARGE AT PORT OF DISCHARGE OR EXPIRY OF 15 DAYS FROM ARRIVAL OF VESSEL. 2.IF THE GOODS ARE TRANSHIPPED,COVER CONTINUES DURING THE TRANSHIPMENT BUT SUBJECT TO A LIMIT OF 15 DAYS FROM THE ARRIVAL OF VESSEL AT THE TRANSHIPMENT PORT. 3.IF 15 DAYS LIMIT EXPIRES BEFORE GOODS ARE LOADED ONTO THE ON-CARRYING VESSEL,WAR COVER IS SUSPENDED TILL GOODS ARE LOADED ON THE ON-CARRYING VESSEL

76. P OSTAL SENDINGS Special Clause devised for this purpose covers--- 1.All Risks of Physical Loss/Damage OR 2.Actual Total Loss of the Post Parcel ( to delete what is not applicable)  D uration :- I.Insurance attaches from the time the Insured Goods are deposited /registered at the Post Office and continues until the goods are delivered to the addressee/their representative at the destinantion OR II.Until expiry of 15 Days from the midnight of the day on which notice of arrival of goods is given to the addressee by the destination Post Office -------- whichever shall first occur  Warranty :-- Goods must also be Insured with the Postal Authorities for the maximum permissible limit as per the Postal Regulations

77. IN LAND TRANSIT CLAUSES IT Clauses--- Coverage  IT Clauses cover transit by Rail/ Road/ Couriers  ITRR ---’B’ Clause covers— 1. Fire 2. Lightning 3. Breakage of Bridges 4. Collision with or by the carrying vehicle 5. Overturning of the carrying vehicle 6. Derailment/accidents of carrying vehicle/railway wagon  IT ---’A’ Clause covers- All Risks other than specific exclusions IT Clauses---Exclusions Wilful Misconduct of the Assured Ullage losses Insufficiency/unsuitability of packing/preparation of Subject Matter Proximately caused by delay Inherent Vice/Nature of the Subject Matter insured War Perils SRCC including Terrorism Unfitness of Vehicle/Container to carry the cargo Malicious Damage* (applicable only to Clause ‘B’)

78. IN LAND TRANSIT CLAUSES..contd. Duration of Cover--- Transit commences on shifting of Cargo for commencement of Transit, continues during the ordinary course of transit, including customary transhipments, if any,and ceases immediately on unloading of the cargo at --- 1.Destination Railway Station (in respect of Rail Transit) OR 2.Final Destination Point (in respect of Transit by Road) OR 3.Until expiry of 7 days after arrival of Railway Wagon at the Destination Railway Station (in respect of Rail Transit ) OR 4.Until expiry of 7 days after arrival of Road Vehicle at the Destination Town (in respect of Transit by Road ) -----------------------------whichever shall first occur

79. EXTENSION OF COVER UNDER ICC-B/IT-B CLAUSES Cover for Extraneous Perils under Inland Clause ‘B’/ICC’B Instead of availing an All Risk policy i.e. as per Inland Clause ‘A’ for inland transit and Institute Cargo Clause “A” for imports/exports, the insured can take cover as per Clause “B” and extend the same to include various extraneous perils, subject to payment of additional premium. Examples of Extraneous perils are given below: a. Theft, Pilferage and Non-delivery b. Fresh/Rain Water Damage c. Damage by Hook/Oil/Mud/Acid d.Breakage/Leakage e.Country Damage (Cotton) f. Shortage g.Bursting and Tearing of Bags h.Heating and Sweating

80. THANK YOU