Instructions to insurance agents

1. Please (insure for us) (insure us on) the following:...

2. Please (cover for us) (cover us on) the goods detailed below: ...

3. Please hold us covered (for) (on) the cargo listed on the attached sheet.

4. The goods are lying at 3 Shed, Royal Docks, London, for shipment to Hamburg (by M.V. Mercury.... Line) (by first available vessel to Hamburg).

5. The cargo is to be insured (warehouse to warehouse) (warehoused or in transit) (against all risks)

6. This consignment is to be covered under our open cover terms.

7. We wish to renew our floating policy no. 56879 on the same terms as before, to cover consignments of textile machinery to West African ports. At the same time please let us have a supply of declaration forms.

8. We shall have several shipments of cement over the next 6 months to West African ports and shall be glad to know your lowest rates F.P.A. The average quantity of each shipment will be about.. tons, valued . .

9. We enclose two declaration forms, duly completed, for shipments of general merchan­dise to Sydney and Melbourne respectively. As this will nearly exhaust the amount of the cover under our policy no. 97539 we shall be glad if you will renew this for a further £10.000

10. We leave the insurance arrangements to you but we wish to have the goods covered against all risks. The premium is to be charged to the consignees, together with all expenses of forwarding, and will be paid by them on presentation of the documents by your agents in...

Replies from insurance agents

11. We thank you for your instructions to arrange the shipment of... We take it that you wish us to insure this cargo against the usual risks, for the value of the goods plus freight. Unless we hear from you to the contrary we shall arrange this.

12. We will effect insurance against all risks, as requested, charging premium and freight to the consignees.

13. We note that you wish to renew the floating policy no. 56879 W.A. covering textile machinery to West African ports, on the same terms; we presume you wish again to have cover up to £15,000.

14. We thank you for your enquiry concerning the shipment of several consignments of cement to West African ports, for which we can quote you as follows:... We presume the cement will be packed in stout paper bags.

15. Owing to the fact that these bags have occasionally been dropped into the water during loading and unloading, the insurers have raised the premium to •..%. We are therefore of the opinion that it would be to your advantage to have W.A. cover instead of F.P.A. The rate for W.A. would be ...%.

INSURANCE CLAIMS

As soon as the consignees receive delivery of the consignment, or collect it from the port, airport or goods station agreed on, they must inspect the goods; this should be done without delay, otherwise their claim on the insurers may be jeopardised. However, it is not enough for the buyers to inspect the goods, if damage is discovered; the insurance companies and Lloyd's will not pay compensation unless they receive a report on the damage from a properly qualified and disinterested person. Such a person is called an insurance surveyor, and in large centres there are, of course, several surveyors. If the surveyor is employed by Lloyd's then he is a Lloyd's surveyor.

The receivers of the goods call in the surveyor to inspect the packing— cases, crates, casks, etc.—and the contents, and to report on the nature and extent of the damage. If the insurance companies and Lloyd's did not require such a report they would soon be out of business, because it would be very easy for buyers to say that the goods had arrived damaged and then put in a claim for compensation.

The buyers also report the damage to the sellers. If, as is probably the case, they are not able to sell the damaged goods, they usually ask for replacements. For these they will have to pay separately, setting the amount of the indemnification against this additional payment to be made. In some cases they may be able to sell the goods at a considerably reduced price, as, for example, if the articles have been scratched or chipped; if materials have been spoiled by sea water, fresh water, oil or other stains, part of the material can, perhaps, be cut off and the rest sold.

The letter written to the senders of the consignment will be on the following lines:

[3] From consignees to senders, reporting damage

Dear Sire

When the S.S. Elinor Ferguson arrived at Port-of-Spain yesterday the ship's agents noticed that case no. 14 was damaged, and notified us accordingly. We immediately had the case opened and examined by Lloyd's agent here.

The number of articles in the case tallies with the packing list, but the following is broken:

(list of broken articles)

We enclose copies of the report of the survey and of a declaration by the ship's agents to the effect that the damage was noticed when the case was unloaded.

As you hold the policy, we would be obliged if you would kindly take the matter up with the underwriters, on our behalf; the number of the insurance certificate is, as you know, 3775842.

In the meantime we will be glad if you will send us replacements for the broken articles as soon as possible, as we have to complete deliveries to our own customers.

We hope to hear from you shortly.

Yours faithfully

Note two points in connection with the above letter:

1. Was the bill of lading clean? If so, the shipowners accepted the case as 'in good condition', or as 'in apparent good condition', and are there­fore liable; if they contend that the damage was owing to insufficiently strong packing, they should have claused the B/L to that effect when they accepted the consignment for shipment. It is, however, possible that the surveyor may report that the articles were badly packed, which would not be apparent from an outside inspection of the cases, so that the shipowners may claim the damage was due to negligence and not to any fault of theirs.

2. The sale must have been on C.I.F. terms, and the sellers arranged the insurance, sending a certificate to the buyers. As the. insurance is evidently of the type known as floating the sellers will continue to hold the policy, which must be produced to the insurers when a claim is made, as the amount of the claim is endorsed on the policy.

If the sale had been F.O.B. or C. & F. the buyers would have arranged insurance themselves, and the letter would be differently worded at the end, probably as follows:

Alternative fourth paragraph for letter no. 3:

‘We are making a claim on our insurance company and will let you know the result in due course.'

Paragraphs for reports concerning accidents involving the principle of general average

16. In heavy weather off the coast of France the vessel's rudder was damaged and she was rendered helpless, having in consequence to be towed into Bordeaux, where repairs are now being undertaken. The expenditure thus incurred will be payable by the ship, freight and cargo in proportion to their respective value, and we, as average adjusters; have been appointed to prepare the necessary adjustment.

17. During discharge from the vessel it was noticed that several bales were very damp and badly water-stained. We attribute this to water used to extinguish afire that broke out in a hold of the vessel, when there was a forced discharge of cargo from that hold.

LLOYD'S

This is the name of the greatest insurance organisation in the world, but it acquired this name in a rather unusual way; Mr Edward Lloyd kept a coffee house in the City of London, in the eighteenth century, and there the underwriters used to meet because it was a good centre for news concerning ships. Later in the same century, after several changes of home, the underwriters occupied the third building of the Royal Exchange (earlier buildings having been destroyed by fire), and organ­ised their business under a Committee of their members. In 1928 they moved to a big new building in Leadenhall Street, and as this soon became too small an extension was built and opened in 1958.

A Lloyd's Slip

Lloyd's is not an insurance company or corporation; the members work as individuals, though usually in syndicates. To become a Lloyd's under­writer it is necessary to be approved by the Committee and to pay a very large sum as entrance fee as well as an annual subscription. Lloyd's underwriters are not allowed limited liability, but in the rare cases of failure (as also in the London Stock Exchange) the insured are not allowed to suffer and the Committee pays the outstanding claims.

As the result of the marine insurance business, Lloyd's branched out into shipping intelligence, and Lloyd's List is published every day, giving the movements of ships and information of 'casualties'. Lloyd's Register, published every year, contains information regarding ships themselves: age, nationality, owners, build, tonnage and classification of all ships surveyed by Lloyd's and conforming to its rules. The classification 'Al-100 Lloyd's' is a guarantee to any prospective purchaser or charterer that the vessel is in good condition and thoroughly seaworthy.

CHAPTER 9.

Date: 2016-03-03; view: 897