Marine Insurance doesn’t offer any coverage in the following cases:
- Loss or damage due to willful act of negligence and misconduct
- Loss or damage due to delay
- Loss or damage due to improper packing
- Financial default or insolvency of owners, charterers, managers, or operators of the vessel
- Loss or damage due to wire, strike, riot, and civil commotion
- Loss or damage arising from the use of nuclear fission, weapon, or any other radioactive force
- 1/4th of collision damage
- Removal of wreck
- Contamination due to radioactive rays
- Attack or damage from biological, biochemical, chemical, or electromagnetic weapons
Read about what is covered under Marine Cargo Insurance
Cases on Marine Insurance Exclusions
In 2015, Excel Electronics got a big contract of exporting 500 electronic items, including LEDs, mobiles and washing machines, to an Eastern country. Before dispatching, the packaging team scrutinized it thoroughly and the consignment was released only after getting a green signal from the team.
It took seven days for the consignment to reach the destination. However, at the time of unloading, the buyer found out that the consignment was wet. It was apparently due to the negligence of the packaging team that a substantial part of the consignment had been damaged due to water.
The buyer filed the case against the seller and asked for compensation. The seller, on the other hand, had marine insurance and therefore, approached the insurer for the claim settlement. However, the insurer rejected the claim as the damages were caused due to improper packing. As a result, Excel Electronics had to pay for all the losses on its own.
In a similar case, M/s G.S Automobile sent a consignment of automobile tools to a neighboring nation. However, at the time of unloading, 1/4th of the consignment got damaged. Though G.S Automobile had marine insurance; the insurer refused to offer the cover as the damage fell under the exclusion.