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Know the Principles of Marine Insurance

Marine insurance is not any type of insurance brought recently to the market, but it has been around for years. Apart from this, with time, it has developed with the expansion of trade.

Marine insurance is necessarily concerned with overseas trade. There is a trade, which involves the transformation from one place to another by ships. Now, this procedure of transshipment of goods from one place to another has its fair share of risks. 

That’s why it becomes essential to secure these goods. Besides, marine insurance is vital as it delivers protection against any loss/damage incurred to the ship and to the cargo, which the ship is transporting. 
Whether you own a yacht or ship for any commercial or any transportation purpose, marine cargo insurance policy will protect you from every marine-related risks. 

Principle of Utmost Good Faith


The marine insurance policy rely on the principle of utmost good faith, which clearly shows that when filling the marine insurance policy document, the holder should give proper details. Also, the applicant would not withhold any material details. If the applicant conceals or hides essential information, the marine insurance company has every right to ignore the policy application. 

Principle of Insurable Interest


As per the principal, it is essential for the policyholder to have some insurable interest in the subject for which he/she wants to buy insurance. It means, the policyholder should get advantage from the safe arrival of goods and should suffer losses due to damage of goods. It might happen that the policyholder does not have an insurable interest during purchasing a marine insurance policy, however, he should expect to have such interest in the future. It is essential that the policyholder must have some insurable interest in the insured item otherwise he will not be able to get the claim from the insurer. 

Principle of Indemnity


According to the principle, the marine insurance policyholder would be compensated only to the extent of the loss. It means, the person should not buy marine insurance to get profits. In any case, the policyholder will not get more than the actual loss happened. 

Principle of Cause Proxima


At the time of loss, the marine insurance policyholder would consider the proximate or nearest cause, which would assist in analyzing the genuine cause of loss when there would be a series of causes that have contributed to the loss. Here, a remote cause for a loss is not needed to analyze the liability, and therefore, if the proximate cause is insured, the marine insurance company has to fix the claim. 

Principle of Loss Minimization


Just because someone has a marine insurance policy, it does not mean the person can act irresponsibly. It is important for the policyholder to take all the essential steps to curtail and minimize the losses. The policyholder should not behave irresponsibly during an accident just because the property is covered under marine insurance. 

Marine insurance is an aspect that helps with relieving the dangers of monetary misfortune to the property, for example, merchandise, ship, or other movables, in the oceanic vehicle, on the installment of premium by the insured to the insurance provider. So buy marine cargo insurance​ for protecting yourself from such mishaps.