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if thereunto obliged by stress of weather or other unavoidable accident, without prejudice to this insurance. The said vessel, tackle, etc., hereby insured, are valued at . . . . . . . . . . . . . . . . . . . . . . . without any further account to be given by the assured to the assurers, or any of them, for the same.
In the case of cargo and freight policies, while the form is similar to that mentioned above, the following provision is usually made with reference to the beginning and termination of the risk: “Beginning the adventure upon the said goods and merchandise as aforesaid, from and immediately following the loading thereof on board the said vessel and to continue during the voyage aforesaid, until the property is landed.”
The first features to attract attention in the above extract of the policy are the two expressions, “lost or not lost” and “at and from.” Both were introduced very early into marine policies, and both serve a distinct purpose. The object of the first phrase originally was to provide for those cases where the safety of the vessel was feared because of its having long been overdue and unheard from (a very common occurrence before the introduction of steam power, the telegraph, and modern postal communication), and where insurance is, therefore, especially desired. Such cases occur even to-day, and it also frequently happens that the owner of goods may have them exposed to the perils covered by a marine policy before he knows of their having been shipped, or before he has had opportunity to insure them. The real object of the phrase is to have the policy cover a risk irrespective of the condition or position in which the ship or cargo may be at the time when the insurance is effected. To make the contract valid, however, both insured and underwriter must be in possession of the same facts, and neither must have knowledge concerning the condition of the risk.
In explanation of the second phrase, “at and from,” it is important to note that there is a decided difference between insuring a ship and cargo “from” a port and insuring it “at and from” that port. The first insurance would cover a vessel, for example, only from the moment when it departs on her voyage, while the “at and from” insurance would cover the vessel not only while on the voyage, but also at the port of departure before leaving. In case this is the home port, the insurance takes effect as soon as placed, and protects the vessel during the period of preparation for the voyage. In case the port is one at which the vessel has not yet arrived, the insurance commences with the arrival of the vessel at that port, if in safe condition. Following the phrases just noted, there are blank spaces for the insertion of the voyage, the period of time over which the insurance extends, the name of the vessel, and the general description and valuation of the subject matter insured. The presumption is that the voyage will cover the usual route, and will be prosecuted without delay. If the policy is a time policy, the date and hour when the insurance commences and ends must be specifically stated. In the case of goods and merchandise, it is expressly provided that the policy covers immediately after they are loaded on board the vessel and continues during the voyage until safely landed. But where it is necessary to employ lighters in the process of loading, the risk of lighterage, except where otherwise provided, is also covered. In the case of a vessel, the insurance either commences “from” or “at and from” a port, and ends twenty-four hours after the arrival and safe mooring of the saisie, at the port of destination. With respect to freight (the earnings of the ship for conveying the cargo), the insurance covers from the port of loading to the time when the cargo is safely landed; while in the case of a charter the insurance begins when it is effected, and continues, irrespective of the fact that the vessel must load at another port, until the landing of the cargo. With respect to the valuation of the subject matter insured two cases may arise. First, where the value is agreed upon, it cannot be reconsidered unless a clearly proved mistake has been made, or the relation of the assigned value to the real value is such as to afford just grounds for suspecting the existence of fraud or wagering. Where, however, the value is not stated in the policy, as in open and floating policies, it must be proved. In all such cases the insurable value attaching to various interests is ascertained in England and America on the following basis, subject, of course, to any provisions expressed in the policy:
(a) Goods or merchandise: the prime cost (say invoice cost) plus shipping expense and cost of insurance. (b) Ship: the value at the commencement of the voyage, including the outfit, stores, and provisions for crew, advances made against crew’s wages, and cost of insurance. (c) Freight: the gross freight due to the ship on her arrival abroad plus cost of insurance. (d) Other objects of insurance: the value to the assured at the commencement of the voyage plus cost of insurance."
The Perils Against Which Protection is Granted.—Immediately following the general description of the adventure, the marine-insurance policy specifies the perils against which protection is granted. In the policies of a few American companies, the enumeration corresponds exactly with the quaint enumeration in the Lloyds' policy, namely:
“Touching the adventures and perils which the said........... - - - - - - - - - - - - Insurance Company is contented to bear, they are of the seas, men-of-war, fires, enemies, pirates, rovers, thieves, jettisons, letters of mart and countermart, reprisals, takings at sea, arrests, restraints, and detainment of all kings, princes, or people of what nation, condition, or quality soever, barratry of the master and mariners, and all other perils, losses, and misfortunes that have or shall come to the hurt, detriment, or damage of the said vessel (or goods) or any part thereof.”
*William Gow, “Marine Insurance,” p. 67.
Most American policies, however, while retaining the language of the above clause in other respects, omit the specifications of all perils except those of the sea, fire, and barratry, and assume liability for all losses “to which the insurers are liable by the rules and customs of insurance in (name of port), subject to the conditions and provisions contained or referred to by clauses in this policy.” In the case of some companies, especially those insuring inland risks, the policy grants protection against the perils of the lakes, rivers, canals, railroads, and all other losses or misfortunes except those arising from carelessness or lack of skill in loading or stowing the cargo, or in navigating the vessel, or from other legally excluded causes.
A closer examination of the marine perils against whic insurance is granted shows that they may be divided into four main classes, viz.: (1) Those perils which have been appropriately called the “perils of nature,” such as the “perils of the sea” and fire; (2) those enumerated perils which we associate with the conduct of those aboard the vessel, as jettison and barratry; (3) perils arising from the conduct of those not aboard the vessel, such as enemies, pirates, men-of-war, etc.; and lastly (4) those perils referred to in the terminal clause, including “all other perils, losses, and misfortunes that have or shall come to the hurt, detriment, or damage of the vessel or cargo.”
Of these perils many are self-explanatory, and require no comment. Many, though very important at one time, when travel was slow and dangerous and commerce subject to piracy and privateering, have become relatively unimportant to-day, owing to the introduction of the telegraph, modern postal communication, and the numerous other changes which have completely revolutionized commercial facilities and methods. Four of the perils mentioned, however, may require a few words of explanation, namely, the “perils of the sea,” fire, jettison, and barratry.
The “perils of the sea” do not include all casualties that may happen to a ship or cargo on the sea. Not only must the loss be incurred in consequence of some peril which is of the sea, but, even where this is the case, it must be the result of an unforeseen occurrence, i.e., an accident. It must not be in consequence of occurrences which are inevitable in all navigation, such as the wear and tear produced by the wind and waves, or the inherent defects and natural deterioration of certain classes of articles. According to Phillips the term “perils of the sea” comprehends those of the winds, waves, lightning, rocks, shoals, collision, and, in general, all causes of loss and damage to the property insured, arising from the elements and inevitable accidents." Likewise in the case of fire, the underwriter is liable for all losses arising from it, provided only that the cause was accidental and not brought about by any action of the insured for which he is considered responsible. Among the many causes of fire covered by the policy are lightning, spontaneous combustion, and the damaged state of the cargo.
Jettison consists of “the throwing overboard of a part of the cargo, or any article on board the ship, or the cutting and casting away of masts, spars, rigging, sails, or other furniture for the purpose of lightening or relieving the ship in case of emergency.”* This definition does not cover those cases where goods are jettisoned because of natural deterioration or inherent defects. Nor does it cover jettison of property due to the negligence or default of the owner; nor of deck cargo, except where expressly permitted in the policy.
Barratry, on the other hand, “comprehends not only every species of fraud and knavery covinously committed by the master with the intention of benefiting himself at the
1 Willard Phillips, “A Treatise on the Law of Insurance,” Vol. I, p. 635.
*Frederick Templeman, “Marine Insurance: Its Principles and Practice,” p. 33.