Asian Business

School
Submitted By:

Shivam Sharma
Section: A
Batch 2018-20
Enroll No. 137

Case Study (International Trade)

Ques: Identify the various parties involved in case of marine insurance along with their
roles.

Ans: There are two parties involved in marine insurance:

1. The insurance company is also known as underwriter who assumes the liability as and when
loss occurs. The role of insurance company would be to insure that if loss occurs then it should
be natural and the beneficiary will get the insured amount.

2. The insured is the one who procures the policy or becomes the beneficiary through the
insurance contract. The insured one is entitled legally to claim the amount if the loss has
occurred naturally or fall in the nature of marine insurance.

There are some principles also which governs the marine insurance.
Principle Utmost Good Faith: The insured must disclose all the facts known to him. or ought to
be known to him, in ordinary course of business.

Principle of Insurable interest: Any person who has 'insurable interest' in the cargo only can
insure. Exporter is said to have insurable interest in the safe arrival of cargo as he is the owner of
the property.
Principle of Indemnity: The underwriter indemnifies the loss arising from the risks covered
under a policy. In a contract of indemnity, only loss is made good. However, a marine insurance
is commercial indemnity, so even the reasonable anticipated profit is also made good.

Causa Proxima: The insurer indemnifies if the loss arises only from the nearest cause. If goods
are stolen due to faulty packing, the insurer does not indemnify the loss.

Ques: Write the precise of the case.

Ans: Marine insurance deals with goods when these are being moved from one place to another
by approved mode of transportation. The goods can be moved within the country and outside the
country. The risks are involved in any type of transportation and to cover these risks marine
(transit) insurance is developed. The risk coverage depends upon the nature of goods and
packing and to cover the risks the price is to be paid which is known as premium. The
consignment can be single or multiple and accordingly the marine insurance policy i.e. single
transit or open cover or open policy is issued by the insurance company.

In this case, en-route to the final destination, Zambia, one truck was involved in an accident in
Harare and lost more than 23 tons of the product, RBD Palm Olein that it was carrying.

The insurance agent helps the client to claim a refund on the value of the goods lost, by handling
all the administrative formalities with the underwriters relating to the Marine Insurance. One
important aspect of this was the determination of the exact loss in terms of value. At the end the
insured person got satisfied and they were refunded.