国际贸易实务英文第二周瑞琪CargoTransportationInsurance实用教案

1、SEIB OF GDUFS1Learning objectives After learning this chapter you will be able to understand the fundamental principles of cargo insurance be aware of the risks and losses in ocean transportation outline the scope of the Ocean Marine Cargo Clauses of CIC frame the coverage of London Institute Cargo

2、Clauses understand the procedure for lodging claims describe methods of stipulating insurance clauses in Sales Contracts 第1页/共57页第一页，共58页。SEIB OF GDUFS2Definitions Definition of insurance“the practice of sharing among many persons, risks of life or property that would otherwise be suffered by only a

3、 few.” Definition of marine cargo insurance“the insurant enters with an insurance company and/or an underwriter into a contract of insurance in which the insurance company of an insurance premium and the insurance company will, according to the terms indicated in the insurance contract, indemnify th

4、e insurant of any loss that occurs within the scope of coverage”.第2页/共57页第二页，共58页。SEIB OF GDUFS3Parties involved in an insurance practice the insurant / insured/assured The party that procures insurance Can be the exporter or importer depending on the Incoterms adopted in the transaction the insurer

5、 The party undertaking to indemnify the insurant against losses or damages Can be the insurance company / underwriter In China, PICC is usually the insurer the claimant The insurant may not necessarily be the claimant Depending on: who has the insurable interest of the goods when the goods are damag

6、ed or lost第3页/共57页第三页，共58页。SEIB OF GDUFS46.1 Fundamental principles The Insurable Interest Principle The Utmost Good Faith Principle The Indemnity Principle The Proximate Principle The Subrogation Principle The Share Principle第4页/共57页第四页，共58页。SEIB OF GDUFS56.1.1 The insurable interest principle Defi

7、nition: The financial interest of a person in the subject matter insured Forms of insurable interest: Ownership of the goods Charge of insurance Freight A policy without insurable interest is invalid Proof of insurable interest is required at the time of making a claim, not at the time of effecting

8、an insurance第5页/共57页第五页，共58页。SEIB OF GDUFS66.1.2 The Utmost Good Faith Principle (Bona Fide Principle) Both parties be faithful and honest in entering into the insurance contract Marine Insurance Act 1906: If the Utmost Good Faith Principle is not observed by either party, the other party may avoid

9、the contract Avoidance of the contract There is no fraud and the Contract is valid: serve as evidence in a court of law Usually occurs when an insurer refuses to pay a claim, the insured has the right to challenge the insurers right to avoid the contract A void contract has no legal value cannot ser

10、ve as evidence in a court of law第6页/共57页第六页，共58页。SEIB OF GDUFS76.1.3 The Indemnity Principle Definition In the event of loss of or damage to the subject matter resulting from an insured peril, he or she is placed in the same position (not in a better or worse position than) that he or she enjoyed im

11、mediately before the loss occurred Means of effecting indemnity In theory: by replacing the ships or goods lost or damaged In practice: by paying an amount of money equal to the value of the goods lost or damaged Extent of indemnity: total indemnification be limited to the insurance amount: 110% of

12、the insured value the actual loss suffered the insurable interest of the claimant第7页/共57页第七页，共58页。SEIB OF GDUFS86.1.4 The Proximate Cause Principle About the Proximate Cause Principle employed in the judgment of causation between accidents and losses refers to the major and/or effective (not necessa

13、ry the first or the last, but the dominant) cause that has led to the accident. The insurer shall only be responsible for the loss resulted from the dominant cause.第8页/共57页第八页，共58页。SEIB OF GDUFS96.1.4 The Proximate Cause Principle How to decide the proximate cause In case of only one cause within in

14、surance coverage: the insurer shall indemnify beyond insurance coverage: the insurer shall not be responsible for the loss In case of two or more than two causes If all causes are within the insurance coverage, the insurer hold responsible for the loss.第9页/共57页第九页，共58页。SEIB OF GDUFS106.1.4 The Proxi

15、mate Cause Principle How to decide the proximate cause If the former cause is within the scope of insurance coverage and the latter one is out of the scope of insurance coverage, provided there is a direct chain of causation between them, the former cause is regarded as the proximate cause and the i

16、nsurer shall be held responsible for the loss or damage. If the former cause is within the exclusion of the coverage and there is a direct chain of causation between the former and latter cause, the proximate cause is considered out of the scope of insurance coverage and the insurer need not be held

17、 responsible for the loss or damage. 第10页/共57页第十页，共58页。SEIB OF GDUFS116.1.5 The Subrogation Principle Definition When the loss of the property insured is caused by a third party, the insurer is automatically entitled to compensation from the third party after indemnification has been made to the ins

18、urant. The right of subrogation is exercised either in the name of the insurer or that of the insured. The amount recovered The amount recovered shall be limited to the amount of the claim paid under the insurance. If the insurer may recover more than the amount paid by him as a claim, he must pass

19、the surplus proceeds to the insured. 第11页/共57页第十一页，共58页。SEIB OF GDUFS126.1.6 The Share Principle Definition Under the circumstance of double insurance, all the insurers shall jointly bear the loss on the subject matter and share the loss according to their respective insurance proportion. Double ins

20、urance the insured has the risks covered by two different insurance companies upon the identical interest in the identical subject matter. Each insurer is normally only liable, in case of total loss, to pay the insured to the extent of the sum written against his own name (the amount of his subscrip

21、tion) in case of partial loss, some proportion of that sum. 第12页/共57页第十二页，共58页。SEIB OF GDUFS136.2 Marine Risks and LossesPerils of the sea海上(hi shn)风险External/Extraneousrisks外来(wili)风险Risks风险(fngxin)Natural calamities自然灾害Unexpected accidents/fortuitous accidents意外事故General risks一般外来风险Special risks特殊

22、外来风险第13页/共57页第十三页，共58页。SEIB OF GDUFS146.2.1 Marine Risks Two types of risks Perils of the sea Natural calamities Caused by force majeure events such as heavy weather , lightening, Tsunami, earthquake, volcanic eruption, thunderbolt , etc. Unexpected accidents/fortuitous accidents Caused by accidents

23、 such as fire, explosion, vessel being stranded , grounded, sunk or capsized, collision, missing, etc. 第14页/共57页第十四页，共58页。SEIB OF GDUFS156.2.1 Marine Risks External risks/extraneous risks General risks Caused by common factors such as theft, fresh water rain, shortage, leakage, clash and breakage, o

24、dor, heating and sweating, hook damage, rust, breakage of packing, etc. Special risks Caused by military factors, political factors, government regulations such as war, striking, confiscation, etc.第15页/共57页第十五页，共58页。SEIB OF GDUFS166.2.2 Marine LossesTotal loss全部(qunb)损失Partial loss部分(b fen)损失Losses损

25、失(snsh)Actual total loss实际全损Constructive total loss推定全损General average共同海损Particular average单独海损第16页/共57页第十六页，共58页。SEIB OF GDUFS176.2.2 Marine Losses Two types of losses Total Loss : loss of the entire value of the subject matter Actual total loss cargo has been totally lost or has been damaged to t

26、he extent that it has lost its original usage Constructive total loss cargo is not totally lost, but the actual total loss shall be unavoidable or the restoration fees together with other miscellaneous expenses will exceed the anticipated amount of profit. 第17页/共57页第十七页，共58页。SEIB OF GDUFS186.2.2 Mar

27、ine Losses Partial Loss: a partial damage to or the total loss of part of the insured cargo. Particular average A partial loss of the subject matter insured caused directly by a peril insured against, No other cargo sacrificed to save the voyage The owner who suffered the damage refer to the insuran

28、ce company provided his policy covers the specific loss. General average A partial & deliberate sacrifice of the ship, freight, or cargo, or additional expenses incurred to rescue a ship and its cargo from impeding danger or for the common safety of the adventure under a peril of the sea or some oth

29、er hazards.第18页/共57页第十八页，共58页。SEIB OF GDUFS19General Average Conditions for general average Danger threatening common safety materially exists, not foreseen. Measures shall be taken deliberately & reasonably for common interest, aiming to remove the common danger of both vessel and cargo Sacrifice s

30、hall not be caused by perils directly Sacrifice is specialized & expenses are additional, not within operation budget, Actions shall be successful in saving the voyage 第19页/共57页第十九页，共58页。SEIB OF GDUFS20General average G.A. Contribution The party suffering G.A. is entitled to a ratable contribution f

31、rom the other parties interested. Two kinds of general average loss: Sacrifice of part of the vessel or cargo Expenses incurred Loss & expenses shall be shared among carrier, cargo owners in proportion to their respective interested value benefited from the G.A.第20页/共57页第二十页，共58页。SEIB OF GDUFS21Gene

32、ral averageThe calculation of G.A. ContributionTo identify the total general average loss. Total GA loss = the sum of sacrifices + the extraordinary expenses To identify the total general average contributory value. The contributory value refers to the value of property saved as the result of the ge

33、neral average act. Total GA contributory value = the actual value of the property saved + GA loss excluding additional expensesTo calculate the general average percentage.To specify the individual general average contribution of all parties concerned. GA Contribution = Contributory Value GA percenta

34、ge第21页/共57页第二十一页，共58页。SEIB OF GDUFS22General averageIllustrationSuppose a cargo vessel loaded with cargo of Party A and Party B stranded in transit. To save the vessel as well as the goods on it, the master ordered to throw 1000 cases of goods to the sea. The value of the goods thrown overboard for

35、Party A is 20% of his goods (the total value of his goods is CNY20000) and that for Party B is 10% of his goods (the total value of his goods is CNY60000). Extra wages for the seamen to perform the act amounted to CNY5000. The value of the vessel is about CNY5000000. Based on the information above w

36、hat is the G.A. contribution for each party involved?第22页/共57页第二十二页，共58页。SEIB OF GDUFS23General averageCalculation:Total GA loss = 20000 x 20% + 60000 x 10% + 5000 = CNY15000Total GA contributory value = 20000 x 80% + 60000 x 90% +5000000+20000 x 20% + 60000 x 10% = CNY5080000GA percentage = (Total

37、GA loss / Total GA Contributory value) x 100% = (15000 / 5080000) x 100% = 0.295%G.A. Contribution by Party A = 20000 x 0.295% = CNY59G.A. Contribution by Party B = 60000 x 0.295% = CNY177G.A. Contribution by the Carrier = 5000000 x 0.295% = CNY14750 第23页/共57页第二十三页，共58页。SEIB OF GDUFS24General averag

38、eGoverning Rulethe International General Average Rules 2004 (also referred to as the York-Antwerp Rules 2004). Differences between GA and PACauses PA is usually caused directly by sea perils, GA is caused by intentional measures taken to save the common interest.Indemnification PA is often borne by

39、the party whose cargo is damagedGA should be proportionally contributed among all parties benefited from the intentional measures. 第24页/共57页第二十四页，共58页。SEIB OF GDUFS256.2.3 Expenses incurred Two types of expenses Sue or labor expenses When the subject matter suffers the risks within insurance coverag

40、e the insured takes measures to avert or minimize the loss or damage to the subject matter insured. The insurer pays sue or labor expenses to the insured Salvage charge When the subject matter suffers the risks within insurance coverage A third parity other than the insured takes measures to save th

41、e subject matter If the salvage effective and successful, charges can be recovered. (“No-Cure，No-Pay” principle) 第25页/共57页第二十五页，共58页。SEIB OF GDUFS266.3 Coverage of marine cargo insurance of CIC Basic coverage Types FPA (Free from Particular Average) WPA (With Particular Average) A.R. (All Risks) Fea

42、tures Can be covered independently Additional coverage Types General additional insurance coverage Special additional insurance coverage Features Should go with basic coverage第26页/共57页第二十六页，共58页。SEIB OF GDUFS276.3.1 Basic insurance coverage FPA Non-liability of indemnification to a particular averag

43、e The most limited scope of coverage WPA(WA) One step further from FPA: the partial loss of the insured goods caused directly by natural calamities WPA = FPA + partial loss due to natural calamities AR Most comprehensive coverage All risks shall not cover all risks, excluding special additional cove

44、rage and exclusions AR = WPA + general additional insurance coverage第27页/共57页第二十七页，共58页。SEIB OF GDUFS28第28页/共57页第二十八页，共58页。SEIB OF GDUFS296.3.2 Additional Insurance Coverage Types of additional coverage General additional insurance coverage (11 types) TPND (Theft, Pilferage and Non-delivery) 偷窃提货不着险

45、 Fresh Water Rain Damage 淡水雨淋险 Risk of Shortage 短量险 Risk of Intermixture and Contamination 混杂沾污(zhn w)险 Risk of Leakage 渗漏险 Risk of Clash and Breakage 碰损破碎险 Risk of Odor 串味险 Damage caused by Heating and Sweating 受热受潮险 Hook Damage 勾损险 Risk of Rust 生锈险 Loss for Damage Caused by Breakage of Packing 包装破

46、裂险第29页/共57页第二十九页，共58页。SEIB OF GDUFS306.3.2 Additional Insurance Coverage Types of additional coverage Special additional coverage (8 types ) War Risk战争险 Strikes, Riots & Commotions (S.R.C.C.)罢工民变险 Failure to Delivery Risk交货不到险 Import Duty Risk进口关税险 On Deck Risk舱面风险 Rejection Risk拒收险 Aflatoxin Risk黄曲

47、霉素险 Fire risk extension clause for storage of cargo at destination Hongkong, including Lowloon or Macao出口(ch ku)货物到香港（包括九龙在内）或澳门在存仓火险责任扩张险第30页/共57页第三十页，共58页。SEIB OF GDUFS316.3.3 Exclusions loss or damage by the intentional act or fault of the insured;loss or damage under the liability of the consign

48、or; loss or damage from the inferior quality or shortage of the insured goods prior to the attachment of this insurance;loss or damage from normal loss, inherent vice or nature of the insured goods, loss of market and/or delay in transit and any expenses arising therefrom;Inherent vice: the inherent

49、 tendency of the cargo to deteriorate due to the essential instability of the components or interaction among components not resulted from external cause.Risks and liabilities excluded by the ocean marine cargo war risks clauses and strike, riot and civil commotion clauses of C.I.C.第31页/共57页第三十一页，共5

50、8页。SEIB OF GDUFS326.3.4 Duration of Basic Insurance This refers to the period throughout which the insurance company undertakes an insurance liability. usually follows Warehouse to Warehouse Clause (W/W Clause) From the time the goods insured leave the warehouse named in the Policy for the commencem

51、ent of the transit Until the insured goods are delivered to the consignees final warehouse at the destination named in the Policy Limited to 60 days after the completion of discharge of the insured goods from the seagoing vessel at the final port of discharge before they reach the above mentioned wa

52、rehouse第32页/共57页第三十二页，共58页。SEIB OF GDUFS336.3.4 Duration of Basic Insurance War Risk W/W Clause not suitable for W.R. From the time the goods insured loaded on board the vessel named in the Policy for the commencement of the transit Until the insured goods are unloaded from the named vessel at the p

53、ort of destination named in the Policy If not unloaded, limited to 15 days after the midnight of the day when the vessel arrive at the port of destination第33页/共57页第三十三页，共58页。SEIB OF GDUFS346.4 Coverage of marine cargo insurance of ICCLondon Institute Cargo Clauses (ICC) Institute Cargo Clauses (A) I

54、CC (A)Institute Cargo Clauses (B) ICC (B)Institute Cargo Clauses (C) ICC (C) Institute War Clauses Cargo Institute Strike Clauses CargoMalicious Damage Clauses第34页/共57页第三十四页，共58页。SEIB OF GDUFS356.4 Coverage of marine cargo insurance of ICCICC (A/B/C) have independent and complete structure and can b

55、e covered separatelyInstitute War/Strike Clause also have independent and complete structure, but can be covered separately only after agreement from the insurer.Malicious Damage Clauses is an additional coverage and can not be covered independently.第35页/共57页第三十五页，共58页。SEIB OF GDUFS36第36页/共57页第三十六页，

56、共58页。SEIB OF GDUFS376.5 Other types of cargo insurance Two types of overland insurance Overland Transportation Risk WPA Overland transportation All Risks A.R. Duration of insurance: W/W clause Two types of air insurance Air transportation Risk WPA Air transportation All Risks A.R. Duration of insura

57、nce: W/W clause, but the insurance shall be limited to 30 days after completion of discharge of the insured goods from the aircraft at the final airport of discharge. 第37页/共57页第三十七页，共58页。SEIB OF GDUFS386.5 Other types of cargo insurance Two types of parcel post insurance Parcel post Risk WPA Parcel

58、post All Risks A.R. Duration of insurance: W/W clause, but in the case of failure of delivery, where the duration of insurance terminates on the expiry of 15 days counting from the midnight of the day when the notice of arrival of the parcel is issued by the post office at the destination. Note: add

59、itional risks under Ocean Marine Cargo Insurance can be applicable to Overland Transportation Insurance, Air Transportation Insurance and Parcel Post Insurance. 第38页/共57页第三十八页，共58页。SEIB OF GDUFS396.6 Procedures of cargo insuranceTo calculate the insurance amountTo determine the insurance coverageTo

60、obtain the insurance premium rateTo apply for marine insurance and pay the insurance premiumTo obtain an insurance documentTo lodge an insurance claim at the time of loss or damage 第39页/共57页第三十九页，共58页。SEIB OF GDUFS406.6.1 To calculate the insurance amount Insurance amount: the amount of insurance in