§ 1989 Marine Profit Loss Recovery

This law says that if you have a separate insurance for the profit you expect to make from a shipment, you can claim back the part of that profit that matches the loss of the cargo.

Key Takeaways

•Profit can be insured separately from the cargo itself.
•You can only claim the portion of profit that matches the percentage of the cargo lost.
•The claim is based on the ratio of loss value to total value of the shipment.

Example

A company ships a load of coffee beans worth $100,000 and expects to earn $20,000 profit from selling them. They have a separate insurance for that $20,000 profit. If a storm destroys half of the coffee beans, the loss is $50,000.

Because the loss ($50,000) is half of the total value ($100,000), the company can claim half of the insured profit, so $10,000, from the profit insurance.

Where profits are separately insured in marine insurance, in case of loss the insured is entitled to recover that proportion of such profits which the value of the subject matter lost bears to the value of the whole. (Enacted by Stats. 1935, Ch. 145.)

This law says that if you have a separate insurance for the profit you expect to make from a shipment, you can claim back the part of that profit that matches the loss of the cargo.

Key Takeaways

•Profit can be insured separately from the cargo itself.
•You can only claim the portion of profit that matches the percentage of the cargo lost.
•The claim is based on the ratio of loss value to total value of the shipment.

Example

Because the loss ($50,000) is half of the total value ($100,000), the company can claim half of the insured profit, so $10,000, from the profit insurance.

Key Takeaways

Example

Key Terms

References

§ 1989 Marine Profit Loss Recovery

Key Takeaways

Example

Key Terms

References

Key Takeaways

Example

Key Terms

Related Statutes

References

Key Takeaways

Example

Key Terms

Related Statutes

References