With a long coastline of 7500 kilometers, spanning across 9 states and 4 union territories, India has a rich history in the marine trade. Several merchants and traders came to India for the trade of spices, textiles and jewelry. To encourage safe trading, today maritime business is governed by some regulating bodies across the world. Amidst this, International maritime arbitration is the branch of dispute resolution in international trade and commerce. It is a process where two businesses agree to settle a dispute through one or more private individuals, rather than going to trial. This method only works if both parties agree to it, which is usually done by signing an arbitration clause that’s written into the contract. The decisions of the arbitrator(s) are final and legally binding on the parties based on the initial agreement to arbitrate.
The Indian Council of Arbitration governs the maritime arbitration rules and they are to be followed as set by the council. These rules not only guide the formation of an arbitration committee but also it’s functioning, claim and counterclaim process, qualification and process to be followed for empanelment, etc. They serve as a helpful resource for domestic and international maritime arbitrations in India.
Maritime affairs are a broad term that covers a variety of topics related to the sea, such as the financing, building, and sale of ships, the carriage of goods by sea, and the insurance of ships and cargo.
Global Outlook of Maritime Arbitration At A Glance
Nowadays, many international shipping contracts include arbitration clauses. It also enables parties to avoid the negative aspects often associated with the litigation. This in turn gives exceptional advantages to litigation (the process of taking disputes to the court of law), such as being more flexible, having more specialized options, and being more confident.It also enables parties to avoid the negative aspects often associated with the litigation process.
Arbitration provides the opportunity for parties to choose arbitrators that they feel will be beneficial to their case. They are not only wise and have good sense, but also have specialized skills and experience in the relevant field. Referring a dispute to the national court of the place of business would naturally favor the party of that nationality. Therefore, approaching the court is not a wise idea in such a case.
What Maritime Arbitration Includes?
It covers the following: –
- Carriage of products through sea
- Marine salvage
- Towage of vessels
- Any Floating structure.
- Damage claims due to the collision, groundings, fire, or any other accidents at sea or in a port.
- Ownership of vessels
- Aspects related to mortgages
- And the interpretation of shipping documents
Bringing of International Maritime Arbitration Clause in Marine Insurance Contracts
Marine insurance is a contract which protects the insured against losses on the inland waters or any risk that may be incidental to the sea voyage. Insurance policies typically interpret arbitration clauses very strictly. This can deprive the insured person of the advantages of arbitration. These clauses can also pave the way for insurers to completely disregard claims and avoid arbitration proceedings. Therefore, parties need to be aware of such clauses and make sure that they cover every issue relating to their insurance policy. This includes claims for both liability and quantum while arbitrating disputes.
Conclusion
With the emergence of exports, marine insurance has become beneficial to reduce the aspects of financial loss. Especially for the shipping corporation and transporters when unexpected situations or contingencies arise. For more info about marine insurance, contact us for expertise.
About The Author
Simran
MBA Insurance and Risk
With extensive experience in the insurance industry, Simran is a seasoned writer specializing in articles on marine insurance for SecureNow. Drawing from 5 years of expertise in the field, she possesses a comprehensive understanding of the complexities and nuances of marine insurance policies. Her articles offer valuable insights into various aspects of marine insurance, including cargo protection, hull insurance, and liability coverage for marine-related risks. Renowned for their insightful analysis and informative content, Simran is committed to providing readers with actionable information that helps them navigate the intricacies of marine insurance with confidence.
