§ 1995 Insurer Liability For General Average

This law says that in ship insurance, if a loss covered by the policy leads to a shared loss called a general average, the insurance company must pay the insured's share of that loss.

Key Takeaways

•If a covered danger causes a loss, the insurer must help pay the shared loss.
•The shared loss is called a general average and is split among all owners.
•The insurer's responsibility is triggered only when the loss comes from a danger covered by the policy.

Example

A cargo ship hits a storm that damages the vessel, and the crew decides to throw some cargo overboard to keep the ship afloat. The loss is shared among all parties with a general average claim.

Because the damage was caused by a storm (a danger the policy covers), the insurance company has to pay the ship owner's part of the shared loss.

In marine insurance, when an insured is required to make a contribution in respect to the subject matter of insurance toward a general average loss, if the average was called for on a loss by a peril insured against, the insurer is liable for the insured’s loss through the contribution. (Enacted by Stats. 1935, Ch. 145.)

This law says that in ship insurance, if a loss covered by the policy leads to a shared loss called a general average, the insurance company must pay the insured's share of that loss.

Key Takeaways

•If a covered danger causes a loss, the insurer must help pay the shared loss.
•The shared loss is called a general average and is split among all owners.
•The insurer's responsibility is triggered only when the loss comes from a danger covered by the policy.

Example

A cargo ship hits a storm that damages the vessel, and the crew decides to throw some cargo overboard to keep the ship afloat. The loss is shared among all parties with a general average claim.

Because the damage was caused by a storm (a danger the policy covers), the insurance company has to pay the ship owner's part of the shared loss.

Key Takeaways

Example

Key Terms

References

§ 1995 Insurer Liability For General Average

Key Takeaways

Example

Key Terms

References

Key Takeaways

Example

Key Terms

Related Statutes

References

Key Takeaways

Example

Key Terms

Related Statutes

References