Machine generated contents note: Lloyd's of London
Protection and indemnity clubs
The law of marine insurance
The Marine Insurance Act 1906
SG policy
Contract of marine insurance
Valued policy
Unvalued policy
Voyage and time policies
Floating policies and open covers
Assignment
Assignment under the Marine Insurance Act 1906
The insurers right to defend the claim
The Law of Property Act 1925
Assignment in equity
Further reading
London Company Market
The Lloyd's market
Syndicates
Coverholder and binding authority
Formation of insurance contracts
When is a binding contract concluded?
Signing down
Agreements reached via emails
Requirement of formal policy
Can the MRC be a contract of insurance?
The Leading Underwriter Clause
Introduction
Wagering contracts
Legislation
Definition of insurable interest
Types of interest
Ownership
Contingent interest
Contents note continued: Mortgagor and mortgagee
Profit
Pervasive interest
Shareholder
Valuable benefit
Ordinary creditor
Bailee
Expectation
'as interest might appear thereafter'
Defeasible interest
Partial interest
Freight
Date for insurable interest
The nature of the duty
The scope of the duty
Disclosure of material facts
Misrepresentation
Burden of proof
Materiality
Decisive influence test
Increased risk test
Mere influence test
Inducement
Proof of inducement
Inducement is a subjective test and focuses on the actual insurer
No inducement if the outcome is the same with full disclosure or true representation
Negligent underwriting
Misrepresentation by a third party
Presumption of inducement
Material facts
Physical hazard
Moral hazard
Disclosure by agent effecting insurance
Facts that need not be disclosed
Remedies for breach
Contents note continued: Avoidance under Insurance Act 2015
Other remedies under Insurance Act 2015
Variations
Waiver of remedy for breach of the duty of good faith
Waiver by affirmation
Damages for misrepresentation
Duration of the duty of good faith
Scope of the post-contractual duty of good faith
Remedy for breach of the post-contractual duty of good faith
Conclusions about the post-contractual duty of good faith
Insurers' duty of good faith
Contracting out of the Insurance Act 2015
Definition
Creating a warranty
Express warranty
Construction of warranties
Present and continuing warranties
Implied warranties
Warranties of seaworthiness
Voyage policies
Time policies
Privity
Time policies: contractual warranties
There is no warranty that goods are seaworthy
Remedy
Marine Insurance Act 1906
Insurance Act 2015
Strict compliance
Waiver
Waiver by an express policy wording
Contents note continued: Waiver by estoppel
'Held covered' clauses
The basis of the contract clauses
Difference from conditions
Terms not relevant to the actual loss
Contracting out
The custom (or fiction)
Effect of receipt on policy
Producing brokers - placing brokers
The amount of premium
Premium's due date
The custom can be excluded
Premium payment warranty
Adjusted premium clauses
Consequences of non-payment of premium
Broker's cancellation clause
Broker's lien
'Lien on the policy' - possessory lien
Specific lien
General lien
Return of premium
Total failure of consideration
The premium is indivisible
The risk may be divisible
'At and from'
Gross premium to be returned
Account adjustment between the broker and the insurer
True meaning of cause proxima (proximate cause)
Concurrent causes
Insured perils
Perils of the seas
Contents note continued: Perils of the seas and unseaworthiness
Insured perils under standard hull and cargo clauses
Barratry of master, officers or crew
Cargo risks
Both to blame
Forms of loss in marine insurance
Actual total loss
Where the subject matter is destroyed
Where the subject matter insured is so damaged as to cease to be a thing of the kind insured
Where the assured is irretrievably deprived of the insured subject matter
Actual total loss of freight
Time when actual loss must be constituted
The subject matter insured is reasonably abandoned on account of its actual total Loss appearing to be unavoidable [s.60(1)]
Where the subject matter insured is reasonably abandoned because it could not be preserved from actual total loss without an expenditure which would exceed its value when the expenditure had been incurred (s.60(1))
Recovery is unlikely
Contents note continued: The cost of repairing the damage would exceed the value of the ship when repaired (s.60(2)(i)(b))
Insured value
Cost of repair
Place of repair
Constructive total loss of goods
Loss of voyage
Date at which CTL to be assessed
Notice of abandonment
Form of notice and acceptance of abandonment
Timing of notice of abandonment
Circumstances in which notice of abandonment is not needed
Acceptance of abandonment
Constructive total loss of freight
Successive total losses
Measure of indemnity
Partial loss of goods
Partial loss of the ship
Reasonable cost of repair
Unrepaired vessels
Partial loss of the freight
Successive losses
Successive unrepaired partial losses
Mitigation of loss
Principles of contract law
Insurance law
The existence of the duty to mitigate in insurance
Sue and labour clauses: marine insurance
Duration of the duty
Contents note continued: The effect of illegality
Ransom
The quantum meruit principle
Apportionment
Supplementary or not
Consequences of breach of section 78(4)
Apprehension of loss
Duty to mitigate in non-marine insurance
What is a fraudulent claim?
Dishonesty
Materiality and inducement
Remedy for making fraudulent claims
Link with the duty of good faith
Forfeiture of the claim
Remedies for fraudulent claims
Remedies for fraudulent claims in group insurance
More on fraudulent means and devices
Reform
The effect of subrogation
Insurer's rights in respect of the proceeds of the assured's recovery
Insurer's rights in respect of the assured's rights against the third party
Elements of subrogation
The juridical basis of subrogation
Insurer's subrogation rights
Contents note continued: The insurer pays in full under the policy, but that payment does not fully indemnify the assured against his actual loss
A claim on a policy is settled for less than its full value
Limitations to subrogation
The assured is the party that has suffered loss but is also the party responsible for that loss
The nature of recovery by the assured from the third party
Gifts (voluntary payments)
Obligations of the assured and the insurer
Permission to use his name by the insurer
Acting in good faith (not to prejudice the insurers' subrogation rights)
The insurer's duty not to prejudice the rights of the assured
Subrogation action against co-assured
Allocation of recovery from the third party between the assured and the insurer
Insurance in layers
Costs of proceeding against the third party
Subrogation and abandonment
Contribution
Increased value policy
Contents note continued: Brokers: servants of the market
Duties of the brokers
Pre-contractual duties: duties on placement
To exercise reasonable care and skill to meet the assured's requirements
Broker's duties are not absolute but rather a requirement to exercise reasonable skill and care
Duties apply on renewal
Duty of disclosure and not to misrepresent material facts
Producing brokers and placing brokers
Post-contractual duties
Claims procedure
Duties to underwriters
Contributory negligence
In a claim between assured-reinsured and broker
In a claim between placing and producing brokers
Brokers' commission
Definition and types of reinsurance
The parties
Formation of reinsurance contracts
Duty of utmost good faith/duty of fair presentation of the risk
Terms of reinsurance contracts
Limits of incorporation
Implied terms
Presumption of back-to-back cover
Non-proportional reinsurance
Contents note continued: Assessing the deductibles and loss
Wasa v Lexington
Proof of reinsured's liability in claims against reinsurers
First limb: the risk falls within the reinsurance cover
Second limb: bona fine settlements
Qualified follow-the-settlements clause
'Within the terms of original insurance'
Other wordings
Claims provisions
Claims co-operation clauses
Claims control clauses
Construction of claims provisions
Creation of condition precedent
The use of 'condition precedent'
Express statement of the remedy
Remedy and waiver
Relationship between follow-the-settlements and claims clauses
Further reading.
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