Судоводы - 9 семестр / Видищева Т.В., Монастырская О.И. - English in Maritime Business and Law (2014)

The ship and cargo owners (the insured) each pay a percentage o f the value of their goods (the premium) into a fund administered by the insurance Co (the insurer). Should one of the insured then suffer a loss, he can claim compensation from the insurer for the loss; this means he will receive money from the fund to the value o f the loss he suffered.

Some of the risks against which it is possible to take out insurance include: 1.So-called Acts o f God such as fire, floods, earthquakes, etc;

2. Loss o f the goods through being washed overboard:

3.	Damage to the goods, e.g. by breaking, bending, etc.;
4.	Damage to the goods by vermin such as rats and mice;
5.	Loss o f the ship on which the goods are being transported,	e.g. by sinking or
collision with another ship:
6.	Loss o f the goods through theft or non-delivery:
Standard insurance policies generally do not cover political risks		as w ar and strikes.

However, it may be possible to obtain insurance cover o f these risks by paying an extra or higher premium.

The party obliged to obtain the insurance cover will depend on the terms o f the sales contract.

The London marine insurance market is the largest insurance market in the world covering marine risks. It comprises:

1.Lloyd’s (the Lloyd market) and

2.Companies represented at the International Underwriting Association (IUA) (sometimes referred to as the Companied market).

Lloyd’s is not a company, but a society o f individual and corporate members with

uniform practices and procedures, regulated by strict rules. It provides facilities for the transaction o f insurance business. Lloyd’s is involved in 4 areas o f business: m arine (18% o f Lloyd’s business in 2001), non-m arine (59%), aviation (7%) and m otor (16%). Members of Lloyd’s provide the capital which supports the risks underwritten at Lloyd’s. They are either w ealthy individual m em bers (called "names”), who trade with unlimited liability, or corporate m em bers who trade with limited or unlimited liability. In 2001 there were 2,852 individual members and 854 corporate members.

P&I clubs (properly called protection and indemnity associations), o f which several are based in the UK, also provide marine insurance. “Protection” in the title originally referred to shipowners’ protection from the one fourth of collision liability that traditionally, London hull and machinery insurers didn’t cover, while “indem nity” referred to the club’s indemnity, or compensation, for liability to cargo under a contract o f carriage. They are associations of member shipowners and charterers, owned and controlled by the

insured shipowner or chartered members,	for the purpose, basically, o f mutual insurance
against third party liabilities which arise	in connection with the operation o f ships. P&I

clubs include the 13 members of the International Group o f P&I Clubs (and their 4 associate clubs) and a member of small independent clubs.

Whereas with hull and machinery insurance the cost o f the insurance (the premium) is fixed at the start o f the period o f insurance, a P&I Club member will not know exactly how much his insurance will cost for at least a year, and perhaps not for 4 or 5 years.

Each P&I Club sets a premium rating for an individual owner reflecting the risks against which he requires cover, his fleet’s ship types, ages, GRT (Gross Registered Tonnage), trades, flags, crew nationality exposure to risks and other factors including the member’s claims record and the likelihood o f large claims in the coming year.

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The member is advised of his total estimated call for the next 12 months; this comprises an advance call and a supplementary call. Advance calls arc levied on all members at the start of the P&I year, which in February, 20. Later in the year, if claims have been heavier than expected, the managers will ask members for a supplementary call to ‘■'balance the books”. Clubs aim to be accurate in their predictions of future. Refunds arc made when income (calls+investments) exceeds outgoings (claims+expenses).

P&I Clubs retain correspondents at numerous ports worldwide. In all cases correspondents:

3.are, for legal reasons, representatives, and not agents of the club;

4.will attend members’ vessels when so requested by the master or agent to protect a member’s interest;

5.may appoint surveyors to inspect damage, etc.

1.What’s the simplest scheme o f marine insurance?

2.In what cases is it possible to take out insurance?

3.What risks can be covered by insurance? Why do you think political risks are not usually covered by marine insurance?

4.What organisations provide marine insurance?

5.What does Lloyd’s provide?

6.What are the main activities o fP&I club?

7.Who can become P&I member?

8.How is a premium rating setfor an individual owner?

9.What calls should be paid by P&I members?

Exercise 2. Match terms with their definitions

1. Insurance adjuster				A. A demand by an insured party on the insurer
2. Insurance policy				for payment under an insurance policy
				B. A short printed record providing that insurance
				money has been paid and giving insurance
3 . Insurance premium				protection until a proper insurance contract is ready
				C. A written contract by which the insurer in return
				for a payment binds himself to pay the insured
4 . Insurance certificate				a certain sum of money when a stated event happen
				D. A person employed by an insurance company to
5 . Document of title				settle claims under policies issued by the company
				E. Money paid by the insured to the insurers under
6. Insurance claim				the conditions in an insurance policy
				F. A short document issued by an insurance
					Company to an insured party, that an insurance
					contract covers the insured against certain stated
					risks andmentions the essential conditions of the
7 . Cover note					policy
				G A document that gives the holder a right to deal
					with the property to which the document relates as
					though he owns the property
1	2	3	4	5	6	7

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2.Who are the brokers on this certificate?

3.To what destination is the consignment covered?

4.What is the total cover for the consignment?

5.What should be done in the event o f loss or damage?

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Exercise 4. Translate into your native language

The Marine Insurance Act 1906 refers to a marine adventure which is basically a voyage. A marine adventure occurs when a ship, cargo or other moveables are exposed to maritime perils, i.e. are at sea or in port. The above Act defines a contract of marine insurance as “a contract whereby the insurer undertakes to indemnify the assured, in the manner and to the extent thereby agreed, against marine losses”. Because of the difficulty of putting a value on ships at sea or on cargoes in transit, they are valued at the commencement of the risk, and the insurers use that value to determine the measure of indemnity they will give the assured.

Exercise 5. Read a request for marine insurance quotation. Study the details and define the reason for composing a letter. Translate into your native language

(AR (All Risks)

	“KENT, CLARKE g t CO. 1 T D
	SOUTH BANK H O U SE-BO RO UG H ROAD -LO NDO N 5 El OAA
	T ELEP H O N E:+ 4 4 (0)20 7928 7716 •FAC 5 1M ILE:+ 4 4 (0)20 7928 7111
		Email: [e-mail]
Facsimile
To	W o r ld w id e In su r a n c e Ltd
Fax	0 2 0 7 2 6 3	6 9 2 5
From	J.D. S im p s o n
D ate	15 M a y 2 0 —
Pages	3
Subject	D e lta s h ip m e n t

W e w ill b e s e n d in g o n b e h a lf o f o u r c lie n ts , D e lta C o m p u te r s Ltd, a

c o n s ig n m e n t o f 2 0 c o m p u te r s t o N .Z . B u s in e s s M a c h in e s P ty, W e llin g to n , N e w Z e a la n d . T h e c o n s ig n m e n t is t o b e lo a d e d o n to t h e Northern Cross, e x - T ilb u r y 18 M a y d u e W e llin g t o n 25 Ju n e .

D e ta ils o f p a c k in g a n d v a lu e s a r e a tta c h e d . P le a s e q u o t e AR p o r t- to -p o r t ra te .

W e w o u ld a p p r e c ia te a p r o m p t re p ly .

J. V. SuHfxotv

J.D . S im p s o n (M r)

S u p e r v is o r

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Exercise 6. Read the reply to the letter, quotationfor marine insurance. Define the terms ofpayment. Translate into your native language

WORLDWIDE INSURANCE Ltd

Chairman

A.L Galvin ACA FIS

Worldwide House, Vorley Road, London N 1 9 5H n

Telephone: [phone]

F a x :[phone]

Email: [e-mail]

FAX

Managing Director
P i t Erwin CIS
Directors
LSwanne, T it Crowe MC	;
H.B.SideyMA	j

To	J. Sim pson - Kent, Clarke & Co.
Ref	3982/1S098
Fax	02079287111
Subject	Delta shipm ent quotation
Pages	2
	Dear Mr Simpson
	Thank you for your fax of 15 M ay regarding th é above cover.
	I notice th e n et am ount of th e invoice is £22,000, an d pay m en t is by letter of
	credit. I w ould therefore suggest a port-to-port AR valued policy for w hich
	w e can quote £4.3 5p%.
	We w ill issue a cover note as soon as you have com pleted an d returned the
	attached declaration form.
	Yours sincerely
	V c u m tA c L a h r
	David Adair
	M anager
	Q uotations D epartm ent

A	d e c la r a tio n fo r m g iv e s th e in su ra n ce c o m p a n y in fo r m a tio n a b o u t th e sh ip m e n t so
th e y ca n	p rep are an in su ra n ce c e r tific a te .

Exercise 7. Fill in the gaps in the letter on taking out insurance cover using thefollowing English equivalents

Toprovide	to accept a quotation	consignment	toforward
stipulation	cover	seaworthy packing	on or after

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Sovereign Assurance Ltd

London Regional Marine Branch

24 Lime Street

LONDON

Dear Sirs

Thank you for your quotation of 10 April for warehouse to warehouse (страховое покрытие) for а (партия товара) of 50 bales of raw silkfrom Liverpool to Marseille to be shipped (в указанный день или после него) June 1st.

We are pleased (принять Ваше предложение) and would request (отправить) the necessary documents to usfor thepolicy to be signed.

We have taken note of your (условие) that (упаковка при доставки морем) is necessary and will ensure that this is (обеспечивать).

Yoursfaithfully

Exercise 8. Translate into English

1.Клубы взаимного страхования имеют представительства во всех крупных морских портах мира.

2.Самым существенным элементом взаимного страхования является возмещение убытков за недостачу или повреждение перевозимых грузов. Клубы также возмещают судебные издержки и расходы на ведение арбитражных дел.

3.Членский взнос устанавливается в зависимости от застрахованного тоннажа. Членский взнос состоит из двух частей: предварительный взнос и дополнительный

взнос.

4. В страховых случаях капитан застрахованного в клубе судна через судового агента должен обратиться к местному корреспонденту клуба. Корреспондент может потребовать выписки (extracts) из судового журнала, показания свидетелей. Корреспондент ведет расследование (investigate) каждого страхового случая и направляет материалы в клуб.

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UNIT 22

MARINE INSURANCE

Part 2

Vocabulary

•Utmost goodfaith - полное доверие

•Insurance policy - страховой полис

•Insurance interest - страховой интерес

•Subrogation - переход прав страхователя к страховщику

• Hull policy - полис страхования судна

• Cargo policy -	полис страхования груза
• Voyage policy -	полис страхования на перевозку
• Time policy - полис на срок
• Floating policy - текущий полис
• Mixed policy -	смешанный полис

•Trial order - пробный заказ

•Standing order - постоянный заказ

•Open cover policy - генеральный полис

•Underwriter - страховщик (при морском страховании)

•Personal accident insurance- страхование несчастных случаев

•То expire- истекать (о временном периоде)

•Valuedpolicy - таксированный полис

Exercise 1. Read the text and answer the questions

Principle o f insurance. For insurance to function properly, the insurer and insured have to make sure that certain basic requirements are fulfilled when the insurance policy is drawn up.

Utmost good faith (uberrimae fidei). When someone fills out a form applying to take out insurance, he’s obliged to tell the truth about the value and condition of the goods to be insured, and also to mention anything which might increase the risk o f the goods being stolen or damaged. The insurer accepts the application in "utmost good faith ” that all the details supplied by the insured are correct, and fixes the level of the premium accordingly. For this part, the insurer is obliged to deal fairly with the insured, e.g. by making all the conditions of the insurance policy clear to him.

Insurable interest. It is essential that the insured has an insurable interest in the goods to be insured: this means he has to suffer a financial loss if the goods are stolen or damaged. Generally this means that you can take out insurance for your own property, but not for someone else’s.

Indemnity. The idea of indemnity is that if the insured suffers a loss, he has to be paid sufficient compensation to bring him back to the same financial condition as he was in before the loss - not more and not less (this doesn’t apply to life or personal accident insurance). This prevents people from over-insuring their goods in the hope to make a profit.

Subrogation. Once the insurer has compensated the insured for his loss, he has the right to recover the amount in question from the party responsible for the loss (e.g. if the

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insurer can prove that the ship was not seaworthy, he can lake legal steps against the shipowner).

Types of insurance policy

Written evidence of the insurance contract is provided in the insurance policy. The Lloyd’s Marine Policy contains an additional statement requiring immediate notice to be given to the Lloyd's Agent at the port or place where the loss or damage is discovered so that he can examine the goods and issue a survey report. This statement applies to cargo insurances only.

If insurance is needed at short notice, the insurer can provide the insured with a cover note to fulfill this function until the insurance policy is ready. The following types of cover note are available:

- Hull policies cover the ship herself, but not the goods being carried.

- Cargo policies cover the goods carried on board the ship, but not the ship herself.

1. Voyage policy. This type of policy covers the ship and/or cargo for one voyage only.

A contract to insure the subject-matter “at and from” or from one place to another or others, e.g. “from Liverpool to Hong Kong”. This kind of policy may specify a date limit within which the ship is expected to have arrived at the port of destination. It is used by people or companies who only have to ship goods occasionally.

2. Time policy. This is the type of policy used most often. It covers all shipments within a certain time period, e.g. a ship insured for 12 months commencing 12 March 2012. The premium is paid in advance and then adjusted at the end of the period of insurance, depending on the number and value o f shipments made. The insured has the responsibility of filling out an insurance certificate for each shipment, so that an accurate record can be presented at the end o f the insurance period.

3. Floating policy. As the marine Insurance Act states “a floating policy is a policy which describes the insurance in general terms and leaves the name of the ship/ships and other particulars to be defined by subsequent declaration.” Placing each shipment with an underwriter through a broker is time-consuming and also the costs will be uncertain because the premium can be different for each consignment. It’s therefore unusual for single shipments to be separately insured. The floating policy is issued once the underwriter agrees to cover all shipments up to a total value. With a floating policy, the insured and insurer agree in advance on a certain sum at which the goods are to be insured. The insured can then make as many shipments as he wants until this value has been reached, at which point the policy expire ( it reaches the agreed limit) . When all the value of a floating policy has been exhausted it is said to be “run o ff’ or “fully declared’. The floating policy is value related.

4.Mixed policy. This is a combination of the voyage and time policies. The ship and/or cargo is covered for all voyages between two named ports for a certain period of time (e.g. for all voyages from Liverpool to Boston over a year).

5.Open cover policy. It’s a type of marine insurance that provides cover for all shipments made by policyholder over an agreed period, e.g. 6 months. It’s made between the underwriter and shipper, with the latter informing the underwriter, on a declaration form, whenever the shipment is made, and receiving the policy or certificate after shipment.

Forwarding agents often have this kind of agreement with insurance companies, allowing

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them to make shipments, and then inform the insurance company after the shipment has been made. Open cover policy is time related.

6.	Valuedpolicy. This is a type of insurance policy in which the value of the goods to
be insured is agreed		in advance. This policy specifies the agreed value of the insured
subject-matter,	e.g. a	policy of US $1 million on hull and machinery value at US $ 3

million. The agreed value may not be the actual value of the subject-matter.

1.What are the principles o f insurance? Why are they necessary?

2.In what cases can subrogation be possible?

3.What is the difference among a time policy, a floating policy and a mixed policy? Give some examples where the insured may prefer to choose one over the others.

Exercise 2. Fill in the chart

D is tin g u is h in g fe a tu r e s

T y p e s o f p o lic y

T h e c o v e r o f

P e r io d o f c o v e r a g e

p o lic y

Hull policy

Cargo policy

Voyage policy

Time policy

Floating policy

Mixed policy

Open cover policy

Exercise 3. Complete the missing terms used in insurance. Pay attention to the first letter o f the word

1.An i______________________company indemnifies clients against loss.

2.An insurance p_______________________ is a contract taken out to protect someone against future risks.

3.Clients are i_______________________ against loss or damage when they have insurance policies.

4.A p__________________________ is the amount o f money paid to the insurance company for cover.

5.L___________________List is a daily newspaper about shipping movements and cargo markets.

6. A client sends their insurance company a c___________________ form when they have suffered damage or loss.

7. The job of an average a_______________________ is to examine damage and estimate compensation.

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Exercise 4. What type of insurance policy wouldyou use in each case?

1.A customer in China placed a trial order.

2.A Co. in Britain received a standing order from Canada.

3.A carpet importer in Greece often places orders with a Co. in Iran. However, as sales

fluctuate, the size and value of the orders tend to vary and is not always predictable.

4.An exporter in Japan was offered a two-year contract to supply goods to various branches o f a French corporation.

5.A family immigrating from Iraque to Australia sent most of their household goods

by ship.

Exercise 5. Scan 1) the quotationfor open cover and 2) the claim under open cover. Analyze the situation and answer the questions. Translate both letters into your native language

In an open cover policy, the client can be certain that the consignment is insured as soon as they have returned the declaration form to the insurance company. Settlement may either be on a monthly or quarterly basis, or per shipment. When insurance cover is nearly used up, the insurance company will inform the client and ask if he wants to renew the policy.

WORLDWIDE INSURANCE Ltd

Chairman

A.LGalvinаса F IS

Worldwide House,Vorley Road*London M 19	$H D	ManagingDirector
Telephone:[phone]		PJt.Erwincis
		Directors
Fax:[phone]		L. Swanne, T.R.Crowe MC
Email, [e-mail]		H.B.SideyMA
		Your Ref: 5/3/20—
		Our Ref: M1-C16893
		Date: 7 M arch 20—

Ms Elaine Goodman

Export Department

Glaston Potteries Ltd

Clayfield

Burnley BB10IRQ

Dear Ms Goodman

In replyto your email of5March, Iam pleased to say that we can arrange an ARopen coverpolicyfor chinaware shipments to North and South American eastern seaboard ports.

Asyou propose to ship regularly, we can offer you a rate of f 4.48p%for a total coverof £200,000.1 enclose a blockofdeclaration forms - you would be required to submit one for each shipment giving full details.

Ilook forward to your confirmation that these terms are acceptable.

Yours sincerely

D a m tlA cL u r

DavidAdair

Manager, Quotations Department

Enc.Declarationforms

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