SHIP OPERATIONS and MANAGEMENT MODULE 3 24.pptx

Shipping opration

1. SHIP OPERATIONS and MANAGEMENT MODULE 3 AND 4 MARINE INSUARNCE AND CHARTERING NITHIN JOSHUVA SIT

2. What is marine risk management? Risk management is the continuing process to identify, analyze, evaluate, and treat loss exposures and monitor risk control and financial resources to mitigate the adverse effects of loss. Maritime risk management ensures that safety measures are in place and that vessels operate within acceptable risk limits, reducing the likelihood of accidents and their potential impact

3. example of maritime risk? Onboard fires, cyber attacks and the risk that distracted captains will run vessels aground are all leading to increased cargo marine losses. Fire, explosion, or 'perils of the sea' risks such as grounding, stranding, sinking, and capsizing, would be major risks for vessels. In some locations, war, strikes, piracy, or ice damage also pose risks.

4. Insurance What is Insurance ? Risk-transfer mechanism that ensures full or partial financial compensation for the loss or damage caused by event(s) beyond the control of the insured party. Under an insurance contract, a party (the insurer) indemnifies the other party (the insured) against a specified amount of loss, occurring from specified eventualities within a specified period, provided a fee called premium is paid. Marine insurance is a contract whereby one party, for a stipulated premium, undertakes to indemnify the other against certain perils or sea risks, to  which his ship, freight, or cargo, or some of them may be exposed, during a certain voyage, or a fixed period of time.

5. Origin of Marine Insurance – Origin in Greek and Roman maritime loan. Marine insurance contracts were developed in Genoa and other Italian cities in the fourteenth century. 1680 - Edward Lloyd opened a coffee house on Tower Street in London, the first marine insurance market. London Insurance Market growth led to the standardization of policies and judicial precedent further developed into the marine insurance law. In 1906 the Marine Insurance Act codified the previous common law; it is both an extremely thorough and concise piece of work. “Marine Perils means the perils consequent on”, or incidental to the navigation of the sea, that is to say, perils of the seas, fire, war perils (enemies), pirates, rovers, thieves, captures, seizures, restraints and detainment of princes and peoples, jettisons, barratry and other perils, either of the like kind or which may be designated by the policy.”

6. Hull And Machinery Insurance Hull and machinery insurance is a type of ocean marine insurance, which protects the insured vessel or fleet against - physical damage caused by a peril of the sea or other covered perils while the vessel is in transit over water. Covered by the Marine Insurance Act of 1906. Hull and machinery insurance policies can be written to cover a single vessel or the whole fleet of a ship owner This insuance covers : Costs of repairing physical loss or damage to a vessel. Reimbursement following total loss of a vessel (Actual and Constructive) Expenses to prevent loss (Sue & Labour,Salvage and GA contributions) Collision Liability (if a running down clause is applicable) Expenses associated with claims ( survey fees etc.).

7. 5 Principles of Marine Insurance principles of marine insurance include six principles. But the principle of good faith is considered an essential mandate commonly agreed among all the parties involved. It states that when two parties, the insured and the insurer, agree, all the cargo details shall be provided with utmost honesty. Indemnity: This principle differentiates the marine insurance policy from a speculative product for capital markets. For instance, a put or call contract can be used in the capital markets for making profits. However, there are various types of marine insurance plans specifically designed to protect against losses. Hence, the payable claims will never exceed the loss incurred by the insured entity.

8. Insurable Interest: This principle can be equated with the common phrase of 'skin in the game.' It means that the insurer must have some interest in the safe arrival of the goods at the end of the transit cycle. If the goods arrive on time and undamaged, the insured entity stands to benefit, and if they do not reach at their stipulated time in their described condition, the same entity stands to bear a loss. Proximate Cause: If you get creative and think like a philosopher, you can practically establish some form of speculated causality between any two events. Using this, your insurance claim as an entity can be attributed to almost any reason, giving you an unreasonable advantage against the insurance company.

9. Subrogation: Subrogation is the follow-through principle for the indemnity principle. It limits the scope to profit from an insurance contract. After disposing of the damaged goods, the net amount exceeding the actual price of the goods post the claim must be returned to the insurer.

10. Insurance Broker And Underwriter The Insurance Broker : An Insurance Broker works independently of the insurance company and is not restricted to a single company, policy or premium structure. An Insurance Broker represents and owes a fiduciary duty to the client. An Insurance Broker represents the client to many insurance companies and provides many options to the client. An Insurance Broker is able to negotiate on behalf of the client and help determine the best insurance carrier and policy for the client. An Insurance Broker is able to seek options if an underwriter declines the policy or charges too much money.

11. The Underwriter An Insurance Underwriter works for a single insurance company and is restricted to the policy and premium offered by that company. An Insurance Underwriter represents and owes a fiduciary duty to a single insurance company. An Insurance Underwriter provides a single option to a client. An Insurance Underwriter is only able to negotiate on behalf of the insurance company he or she works for and with limited authority. An Insurance Underwriter has no options if they are unable to quote a policy or is confined to a filed premium rate structure

12. Marine Insurance – How It Works ? Broker approaches Insurance companies with lead terms - submits the full particulars of the risk to be placed, the SUBMISSION - full vessel specifications, the values and management loss record. Amount of the risk is large or complex - more than one market is required and circulate it to more markets. As with all Insurances the DOCTRINE OF UTMOST GOOD FAITH applies - The expression “good faith” and its related expressions ( ie “utmost good faith” and “ uberrimae fidei” – Latin ) are used primarily in relation to the pre-contract disclosure obligations of an insured and, post-contract, in respect of the obligation of an insured not to make fraudulent claims. It is therefore prudent to disclose all material facts in the submission. In case the Doctrine of Utmost Good faith has not been followed in the submission there are chances that the underwriters can void the contract at any time when it is learnt that a true and honest submission has not been made. Some countries - obligation by law that the insurance be placed with a local, often national insurance companies, which might or might not reinsure with a leading market. Local insurer reinsures in another market overseas - a lawful practice

13. The Premium An insurance premium is the amount of money that an individual or business must pay for an insurance policy. Premium is considered income by the insurance company once it is earned, and also represents a liability in that the insurer must provide coverage for claims being made against the policy. This is normally expressed as a percentage of the agreed value of the risk. In Marine Hull and Machinery insurance the agreed value must not be less than that of the reasonable market value of the ship. This represents the limit of the underwriters indemnity. This premium rating is negotiable and dependent on - the type and size of the ship or the fleet, the reputation and experience of the owners and operators and their loss record over previous years and in line with the state of the insurance market . The amount that a ship owner is willing to accept to his own account in the case of an incident is called the DEDUCTIBLE.

14. Marine Losses Marine Losses can be divided into two main categories – Total Loss - where the subject matter insured is destroyed or so damaged as to cease to be a thing of the kind insured or where the assured is irretrievably deprived thereof. Partial Loss - Any loss other than a total loss is a partial loss. The partial loss is there where only part of the property insured is lost or destroyed or damaged partial losses

15. Total Loss Actual total loss : (a) The subject-matter is completely destroyed. (b) The goods are so damaged that they cease to be a thing of the kind which were insured. c) The insured is deprived of the subject-matter. When a ship is sunk or is completely destroyed by fire, it will be a case of actual total loss. A case when the goods are so damaged that they do not look like goods which were insured e.g. if crockery is reduced to pieces, it is a case of actual total loss. In another case if the insured is not able to get the things back i.e., if the ship is missing and there is no trace of it, it is also a case of actual total loss. Actual total loss the insured is entitled to recover full amount of loss. When the insured has been compensated the title of goods passes on to the insurer. If some amount is received from the sale of damaged goods, the amount will go to the insurer and not to the insured.

16. Constructive Total Loss This occurs when the ship is abandoned for certain reasons It is not commercially viable to retrieve the ship or cargo. The ship or the cargo is not wholly destroyed but it is not practicable to get it repaired and restore it to its original position. When a ship is badly damaged, and the cost of repairs is expected to be more than the value of the ship, it will be advisable to abandon the ship. In the same way, if the cargo is safe in the abandoned ship but the cost of bringing the cargo to the coast is more than the cost of cargo, then it will be proper to leave the cargo. In the case of constructive total loss, the insured gives a notice of abandonment and surrenders its interest in the subject-matter to the insurer. The insured can claim damage for total loss.

17. Partial Loss When the subject-matter is partially damaged, it will be a case of partial loss - two types: Particular Average & General Average Particular Average Loss - is a partial loss or damage caused to any particular cargo or property where the damage is suffered by a particular interest.  The damage or loss should be of a particular subject matter in which case the damage suffered cannot be partially shifted to others and the loss would be borne by the persons directly affected by the damage to the said cargo. Remember that it is a partial loss hence not the entire cargo or property would be damaged but a part of it. The damage could either be to the cargo or the ship. A particular average loss with regards a cargo may either be depreciation in value of the cargo or a total loss of a part of it. For instance when part of a cargo is destroyed by say sea water or about 4 out of 10 of a number of cargoes are destroyed.

18. GENERAL AVERAGE – Explanation The law of general average is a legal principle of maritime law according to which all parties in a sea venture proportionally share any losses resulting from a voluntary sacrifice of part of the ship or cargo to save the whole in an emergency. In the exigencies of hazards faced at sea, crew members often have precious little time in which to determine precisely whose cargo they are jettisoning (THROW) . Thus, to avoid quarrelling that could waste valuable time, there arose the equitable practice whereby all the merchants whose cargo landed safely would be called on to contribute a portion, based upon a share or percentage, to the merchant or merchants whose goods had been tossed overboard to avert imminent peril (TYPE OF HAZARD) . General average traces its origins in ancient maritime law and still remains part of the admiralty law of most countries.

19. The first codification of general average was the York Antwerp Rules[2] of 1890. American companies accepted it in 1949. General average requires three elements which are clearly stated by Mr. Justice Grier in Barnard v. Adams: "1st. A common danger: a danger in which vessel, cargo and crew all participate; a danger imminent and apparently 'inevitable,' except by voluntarily incurring the loss of a portion of the whole to save the remainder." "2nd. There must be a voluntary jettison, jactus , or casting away, of some portion of the joint concern for the purpose of avoiding this imminent peril, periculi imminentis evitandi causa, or, in other words, a transfer of the peril from the whole to a particular portion of the whole." "3rd. This attempt to avoid the imminent common peril must be successful".

20. York Antwerp Rules 2004, there is a general average act when, and only when, any extraordinary sacrifice or expenditure is intentionally and reasonably made or incurred for the common safety for the purpose of preserving from peril the property involved in a common maritime adventure. General average sacrifices and expenditures shall be borne by the different contributing interests on the basis hereinafter provided. A loss is deemed to be considered under general average if and only if the reason of sacrifice is extraordinary or the sacrifice is reasonably made for the purpose of common safety for preserving the property involved .E.g. Capsizing due to inclement weather condition, shifting of cargo leading to excessive listing of vessel, Falling Containers. The onus of proof is upon the party claiming in general average to show that the loss or expense claimed is properly allowable as general average. All parties claiming in general average should give notice in writing to the average adjuster of the loss or expense in respect of which they claim contribution within 12 months of the date of the termination of the common maritime adventure.

21. Acceptable Expenses On GENERAL AVERAGE Extinguishing fire onboard  Voluntary stranding Damage to machinery and boilers Expenses lightening a ship when ashore and consequent damage Cargo, ship's materials and stores used for fuel Expenses at port of refuge

22. Average Adjusters & Adjustment Process Average Adjusters are expert in the law and practice of general average and marine insurance. Prepare claims under marine insurance policies which generally involve loss or damage to marine craft, their cargoes or freight. Called upon to prepare statements of claim against third parties and to deal with the division of recoveries from third parties. Adjustment Process- Weeds out unconnected expenses and account for only the allowed expenses. The task will get complicated if the case involves port of refuge, repairs, salvage costs, etc. In case of a container ship, there will be thousands of Bills of Lading involved and the average adjuster has to estimate the true value of all the cargoes to arrive at the contribution to be made by them.

23. General Average Exercise A vessel suffered a damage during the voyage and declared General Average. This incident involved a Loss of Usd 45000 and a General Average expense of Usd 15000. The ships value was 3,000,000 Usd and the value of the cargo was Usd 300,000 What should be the contribution from the vessel owners and the contribution from the Cargo Interest ?

24. GA Exercise Solution GA Loss General Average Sacrifice - Usd 45,000 General Average Expense - Usd 15,000 GA LOSS TOTAL Usd 60,000 Contributory Values Ship Usd 3,000,000 Cargo Usd 300,000 Total Contribution Usd 3,300,000 GA Contribution Ship pays Usd 54,545.45 Cargo Interest pays Usd 5,454.54 Total Usd 60,000.00

25. Difference Between GA & PA Loss 1.General average is incurred for the benefit of all interests but the particular average is in connection with any of the interests. 2. General average is always voluntary and intentional but the particular average is an accidental or fortuitous. 3. General average is shared by all those who are benefited by the general average act. Particular average is paid by the insurer. 4. General average may include expenditure and sacrifice along with loss, whereas the particular average results from a loss or damage.

26. Salvage Salvage,  in maritime law, the rescue of a ship or its cargo on navigable waters from a peril that, except for the rescuer’s assistance, would have led to the loss or destruction of the property. Except for salvage performed under contract, the rescuer—known as the Salvor —must act voluntarily without being under any legal duty to do so, apart from the general duty to give assistance to those in peril at sea or to stand by after a collision. So long as the owner or his agent remains on the ship, unwanted offers of salvage may be refused. A derelict—a vessel found entirely deserted or abandoned without hope or intention of recovery—is, however, fair game for anyone who comes across it. Typical acts of salvage include releasing ships that have run aground or on reefs, raising sunken ships (or their cargo), putting out fires, and so on.

27. The popular belief that a salvor becomes the owner of the property, at least if it was abandoned by the owner or was derelict, is erroneous. The owner may always reclaim his property from the salvor on paying salvage money. The salvor, for his part, has a maritime lien on the salved property (in an amount determined by national statute or juridical custom) and need not return the property to the owner until his claim is satisfied or until security to meet an award is given. An owner who elects not to reclaim his property cannot be made liable for a salvage reward.

28. Much salvage is carried out under contract by professional salvors. In the past, if there was no recovery, there was no payment, whatever the expense of the operation. This was referred to as NO CURE NO PAY and the salvage contract was referred to as the LLOYDS OPEN FORM . In return for salvage services, the salvor receives a proportion of the “salved value” (the value of the ship, its bunkers, cargo and freight at risk). In view of Environment damage concerns - Changed in recent years, to reflect the public interest in prevention of damage to the environment. The salvor can now contract in such a way that he is shielded from loss when responding to high risk or low value casualties.

29. Todays salvage contracts can also be based on a fixed rate for the services rendered irrespective of the outcome or based on a combination of what the rates will be but in any scenario, no matter it being successful or unsuccessful. LOF, however, remains the internationally preferred contract. Even today 50% of the salvage operations are conducted on LOF basis. Lloyd’s Standard Form of Salvage Agreement (universally known as Lloyd’s Open Form, or LOF) was adopted in 1892 and the text had been standardised by 1908. Current edition is LOF 2011, which is the 11 th revised edition introduced in January 2011.

30. Salvage And Award When a Salvor provides services to a commercial vessel, salvage costs are shared between both ship and cargo interests and under current marine policies (IHC 2003) they fall under General Average. Masters have the power to call for salvage services when he sees an imminent danger or distress. He acts as an agent for both the ship and cargo interest due since the situation warrants such a situation. Once Salvage has been requisitioned the Master and the Owner have a duty to co-operate with the salvor during the entire operation. The Salvour has the responsibility of exercising due care to prevent further damage to the ship and her cargo and to try minimise any damage to the environment. The average adjuster as in the case of General Average is appointed to carry out the necessary adjustments when salvage costs are finalised.

31. When a Salvage in done on an LOF the award is calculated on the basis of the salved value of the ship and her cargo. The amount of the salved value is based on the below:  The degree of danger from which the vessel was rescued; The post-casualty value of the property saved ( vessel, cargo, freight, bunkers and any other value saved) The risk incurred in saving the property from impending peril; The promptitude, skill and energy displayed in rendering the service and salving the property; The value of the property employed by the salvors and the danger to which it was exposed; The costs in terms of labor and materials expended by the salvors in rendering the salvage service Even in a no cure no pay LOF, where the salvor is unable to save the vessel and its cargo, present day salvage awards also provides for compensating the salvor an enhanced amount to cover the cost incurred in preventing or containing pollution damage especially with respect to laden tankers, which introduced in 1980.

32. Salvage Convention Salvage - earlier governed under the 1910 convention - purely on the NO CURE NO PAY principle. 1910 convention - not allowing for any efforts taken to protect the environment this had to be amended. Under the old convention if the salvor had taken a potential sinking of a damaged laden tanker, he would tow it to deep waters and would sink her there. The ship has not been saved and hence no cure so no award was available. Under the 1989 convention the salvage award is still based on the no cure no pay basis, however the award will take into consideration the skill, efforts and cost incurred in preventing or minimising the damage to the environment. This compensates the costs so incurred by the salvor which is referred to as SPECIAL COMPENSATION under ARTICLE 14 of the 1989 convention.

33. Article 14 of the Salvage convention 1989 signified a fundamental change to the traditional “no cure-no pay” salvage law principle in that: Provides for special compensation for providing services to prevent environmental damage but where the salvage award under Article 13 is inadequate to properly compensate Compensation is based on salvors’ expenses. Article 14 special compensation- not dependent on success unlike “no cure-no pay” principle governing Article 13. Total amount recoverable by a salvor may now exceed the total value of the salved property compared with the traditional cap set by the salved value of the property. The Special Compensation in Article 14 is paid by the liability insurers, in other words, the ship alone . All parties to the marine adventure have an express, explicit, duty to protect the environment.  

34. SCOPIC Clause ( (Special Compensation P & I Club)  Article 14 of the 1989 Salvage Convention ('Article 14') provided that salvors ('Contractors') could receive Special Compensation ( ie their expenses and a fair rate for tugs and equipment used in salvage operations) in certain circumstances where the salved fund was insufficient to allow them to recover adequate remuneration. Invoking the SCOPIC Clause The Contractor shall have the option to invoke by written notice to the owners of the vessel the SCOPIC clause set out hereafter at any time of his choosing regardless of the circumstances and, in particular, regardless of whether or not there is a “threat of damage to the environment”. The assessment of SCOPIC remuneration shall commence from the time the written notice is given to the owners of the vessel and services rendered before the said written notice shall not be remunerated under this SCOPIC clause.

35. Sue & Labour Clause A standard clause in a maritime insurance policy which allows the insured to recover from the insurer any reasonable expenses incurred by the insured in order to minimize or avert a loss to the insured property, for which loss the insurer would have been liable under the policy. The expenses of safeguarding the property will be paid according to the respective interest of the insured and the insurer. Maritime voyages were of long duration and communication between ports and cities were slow, so it was essential that the insured and the underwriters agreed upon measures that shall be taken by the assured in the event of misfortune and catastrophe. In return, it is the duty of underwriters to indemnify the assured for expenses incurred in respect of averting and minimizing the loss.

36. War Risk Insurance War Risk Insurance  is a type of insurance which covers damage due to acts of war, including invasion, insurrection, rebellion and hijacking. Some policies also cover damage due to weapons of mass destruction. War risk insurance generally has two components. War Risk Liability - covers people and items inside the craft and is calculated based on the indemnity amount. War Risk Hull - covers the craft itself and is calculated based on the value of the craft. The premium varies based on the expected stability of the countries to which the vessel will travel.

37. Sanctions Sanction - Sanction Limitation and Exclusion Clause No insurer shall be deemed to provide cover and no insurer shall be liable to pay any claim or provide any benefit hereunder to the extent that the provision of such cover, payment of such claim or provision of such benefit would expose that insurer to any sanction, prohibition or restriction under United Nations resolutions or the trade or economic sanctions.

38. Third Party Recoveries  Marine insurance companies provide "hull and machinery" cover for shipowners, and cargo cover for cargo owners but these policies do not cover for open-ended risks that traditional insurers are reluctant to insure. Ship Owners in view of they providing service for rewards and since third parties use their facility have exposure to claims from these third parties should something go wrong. To Cover such risks ship owners need a protection – P N I Cover. Typical P&I cover includes- a carrier's third-party risks for damage cause to cargo during carriage; war risks; and risks of environmental damage such as oil spills and pollution.  H&M, Cargo and P&I Insurance together give the interests in a marine adventure the insurance cover they need.

39. History - P N I Clubs 18th Century Great Britain, formation of Clubs to provide Hull insurance at reasonable cost. Beginning of 19th Century, Hull insurance became more affordable, Hull Clubs went into decline. (today a few exist but not commonplace at all). As the 19th Century progressed, greater exposure to 3rd Party liability claims, in particular from their crews. Laws were passed which made it even easier for crews and their dependents to claim. Problem further exacerbated by the rapid increase in passenger traffic as emigrants flooded to America and Australia. Shipowners were faced with claims from 3rd parties with those ships they had been in collision. A court ruling in 1836 found that following a collision hull cover did not extend to damage caused by collision. H&M Insurers acted quickly to address this gap but only provided 3/4th of the damage. Original limitation was to the value of the ship itself, but this began to be exceeded, leaving shipowners to find the excess. Shipowners joined together in 1855 and formed the “Shipowners Mutual Protection Society”.

40. Until 1870, exclusions in the Bills of Lading facilitated shipowners to avoid liability for cargo related claims. An incident occurred whereby it was deemed it lay outside of the exclusions and the shipowner was liable and Club rules did not cover the cargo claim. Claim incidents, increasing value of cargoes, cargo interests try and recover their losses - shipowners to look at the cover available to them. “Indemnity Clubs” - established Protection Clubs amended their rules to take on Indemnity risks and “ P & I ” Clubs came into existence. P&I Insurance cover covers • Members’ legal liabilities to third parties which arise out of the operation or management of the ship

41. What is P&I club? A Protection and Indemnity or P&I club is a non-governmental, non-profitable mutual or cooperative association of marine insurance providers to its members which consists of ship owners, operators, charterers and seafarers under the member companies Typical P&I cover includes : a carrier's third-party risks for damage caused to cargo during carriage; war risks; and risks of environmental damage such as oil spills and pollution. In the UK, both traditional underwriters and P&I clubs are subject to the Marine Insurance Act 1906.

42. Who are the members of the P and I Club? The basic definition of a mutual P&I club is that it is an association of shipowners (called “members”) who group together to insure and cooperate with each other on a mutual, not for profit basis, proportional to their tonnage Why is P&I Club important in shipping? P&I insurances are typically provided by P&I Clubs, which are mutual insurance associations. These clubs allow members to pool their risks, leading to more extensive coverage terms and creating a support network that offers legal and technical advice on maritime issues

43. Risks Covered By A P&I Club 1. Death and personal injury of – Seamen, Passengers and Third parties 2. Liabilities in respect of persons saved at sea. 3. Liabilities arising from collisions. 4. Liabilities arising from groundings. 5. Liabilities arising from damage to fixed and floating objects. 6. Liabilities arising from pollution. 7. Liabilities arising from wreck removal. 8. Liabilities arising from towage operations. 9. Liability to cargo. together with other legal and other costs associated with dealing with these claims. .

44. What are the functions of P & I Clubs? Ensure ship owners and operators against third-party liabilities not covered by hull and machinery policies obtained. The club will usually only accept risks on chartered-in-tonnage where the member also has owned vessels entered with the organization. Charterers club exists to offer similar cover for charterers Often ensure entire company fleets, but tend to prefer owners with similar types and standards of fleet May subject owners vessels to inspection before entry into the club and during membership Strive to keep ‘calls on their members’ at a minimum through loss prevention methods such as information bulletins aimed at owners insurance officers Disseminate information aimed at keeping members premiums down

45. Produce lists of correspondents and reliable lawyers and surveyors Produce standard forms of letters of indemnity and protest May post bonds against members, ships when under arrest Issue handbooks containing club rules and lists of correspondents, which are very useful to master seeking advice and assistance win in any kind of trouble

46. Club Entry Shipowner enrolling with a club is called the ENTRY. The applicant has to provide details of the vessel or the fleet which he wants to enter and the Club might exercise its option of conducting a full survey of the vessel. On the successful completion of the survey the vessel is accepted and a certificate will be issued which provides the details of the cover, the call rate, deductibles etc. In case the ship is operated by an entity other than the ship owner say operator, that entity will appear as the CO ASSURED .

47. Claims And Handling Insurance claims generally arise due to accidents and incidents. The circumstances and incidents in the casualties are never the same. However, there would be certain general factors in the casualties. It is imperative that there is a close coordination between the claims department, the technical and the accounts department for a prompt settlement of the claims by the underwriter as the underwriter would require a lot of information on the casualty prior settlement of claims. Most claims will be negotiated between the insured and the Underwriter to determine the actual loss amount. In view of almost all accidents occurring are on board vessels this would be dealt with by the ships staff as best as they can as the situation warrants. When an incident or an accident, which could lead to a claim occurs the information would be passed on from the Master to the Attending Superintendent, who in turn should pass on the information to the Claims Department.

48. Claims department to inform the Broker who in turn informs the Underwriter. This would enable Underwriter to arrange their Surveyor to assess the damage. Inform local maritime authority for incidents on the water and the police for any loss involving theft and vandalism. The P N I Club if the accident is related to losses insured by the Club ( e g – Crew claim, cargo claim, collisions, pollution, contact with fixed and floating objects etc). Forward details of the incident including, dates and times, names and contact details of any witnesses, a diagram of the scene. In the event of a collision or grounding, it will assist with understanding the situation/circumstances of the accident. Keeping the owner and charterer appraised of the developments. Keeping cargo interests informed. If General Average declared to appoint Average Adjuster who in turn to keep all interests such as surveyors, agents etc to enable them collect security or deposits towards general average contribution.

49. Simultaneously the companies technical department to liaise with the vessel and gather information on the extent of damage and plan for repairs in consultation with the Classification Society if damage pertains to Class, such as damage to hull, machinery or other safety aspects of the ship. Vessel crew to photograph the developing incidents as these could come in handy during enquiries postmortem of the incident. All documents and evidences such as log book entries etcc to be preserved and handed over to owners or their representative. These documents are not to be handed over to solicitors of the charterer, the media or anyone. If vessel needs repair the repair port has to be decided in discussion with the Underwriters. The owners representative, a surveyor representing the Underwriter, along with the Class Surveyor would be in attendance during the repairs. the Club representative or its surveyor would also be present if there are any claims that would fall under the purview of the P N I club.

50. The hull insurers surveyor will assess and certify the repairs to be conducted and the cost which he could approved as being fair basis which the owners would proceed with the survey. On completion of the repairs, a detailed report will be prepared by the Underwriters Hull Surveyor and submitted to the owners which could also include an opinion on the reason for the accident. All costs incurred towards repairs and other expenses due to the collision would be forwarded to the average adjuster. The adjuster would then work out the claim statement and the amount payable by the Underwriters depending on the policy clauses.

51. What is underwriting claims? Underwriting, whether for an insurance policy or a loan, revaluates the riskiness of a proposed deal or agreement. For an insurer, the underwriter must determine the risk of a policyholder filing a claim that must be paid out before the policy has become profitable. For a lender, the risk is of default or non-payment . Underwriters are under pressure to find new ways to assess and respond to amplified risk. The number one cause of marine insurance losses in 2022 by value were fires on board vessels, often due to mis-declaration or non-declaration of cargos

52. Claim Submission: It starts when the insured party (usually the shipowner or cargo owner) submits a claim to the insurance company. The claim details the incident, such as damage to the vessel, loss of cargo, or any other covered event. Claim Documentation Review: Underwriters review the claim documentation provided by the insured. This includes reports, surveys, invoices, and any other relevant evidence related to the claim. They examine the circumstances of the incident and verify if it falls within the coverage of the policy. Policy Examination: Underwriters carefully review the insurance policy to determine the extent of coverage for the claimed event. They check for any exclusions, limitations, or conditions that may affect the claim's validity.

53. Assessment of Loss: Underwriters assess the extent of the loss or damage incurred by the insured. This may involve consulting with surveyors, adjusters, or experts to evaluate the value of the claim and the extent of the damage. Risk Analysis: Underwriters analyze the risk factors associated with the claim, considering various aspects such as the nature of the incident, the vessel or cargo involved, the geographical location, and any other relevant factors. Decision Making: Based on the information gathered and analyzed, underwriters make a decision regarding the claim. They may approve the claim for payment, partially approve it, or deny it based on the findings of their investigation and assessment.

54. Settlement: If the claim is approved, the insurance company settles the claim by providing compensation to the insured in accordance with the terms of the policy. This may involve reimbursing for repair costs, replacement of damaged goods, or other forms of financial compensation as specified in the policy. Communication: Underwriters communicate their decision to the insured, providing explanations if the claim is denied or only partially approved. They may also offer guidance on how to proceed further, such as providing additional documentation or information if necessary.

55. Reinsurance Reinsurance is a deal wherein the insurer shares a part of the risk portfolio with another insurance firm. It helps spread the risk to avoid an enormous unmanageable financial strain on a single entity. Reinsurance companies are of two types: facultative and treaty.

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57. Facultative Reinsurance It is called facultative as the reinsurer possesses the “faculty” or power to accept or reject the entire or a proportion of the provided policy. Here, the insurer utilizes it to cover single or multiple risks registered in the insurer’s business book. Facultative reinsurance usually covers a single deal and is a one-time agreement with the insurance firm. Most importantly, the primary insurer and reinsurer design a facultative certificate displaying the reinsurer’s absorption of a particular risk in the contract. 2. Treaty Reinsurance The treaty reinsurance demonstrates insurance obtained from another insurer through the insurance firm. Additionally, this offers extra security for the equity of ceding insurers and increases safety in relevant or extraordinary situations. Therefore, it is further categorized into two categories, namely, proportional and non-proportional.

58. business insurance There are several different kinds of liability insurances, such as general liability insurance, public liability insurance, professional liability insurance, management liability, contractual liabilit y business insurance plans include: General liability insurance Commercial property insurance Business income insurance Professional liability insurance Workers’ compensation insurance Employment practices liability insurance Product liability insurance Commercial auto insurance Commercial umbrella insurance Cybersecurity insurance

59. Insurance business can be broadly classified into two main categories: Life Insurance and General (or Non-Life) Insurance. Each category can be further subdivided based on the nature and scope of the coverage provided. Here's a detailed classification: 1. Life Insurance Life insurance policies provide financial protection against the risk of death. They are designed to offer monetary support to the policyholder's beneficiaries upon the policyholder's death. Subcategories: Term Life Insurance: Provides coverage for a specified period. If the policyholder dies within the term, the beneficiaries receive a death benefit. It has no cash value component. Whole Life Insurance: Offers lifelong coverage and includes a savings component, known as the cash value, which grows over time. Premiums are typically fixed. Insurance business classification

60. Endowment Plans: Provide a lump sum amount after a specific term or on death. These policies combine insurance and investment benefits. Unit-Linked Insurance Plans (ULIPs): These are market-linked products that provide both insurance and investment benefits. The premium is divided into two parts, one for life cover and the other for investment in various funds. Pension Plans: These are retirement plans that provide a regular income stream post-retirement. They accumulate savings during the policyholder’s working years and disburse them as a pension. Money Back Plans: These plans offer periodic returns along with life cover. The policyholder receives a percentage of the sum assured at regular intervals during the policy term.

61. 2. General (or Non-Life) Insurance General insurance policies provide financial protection against various risks other than death, including health, property, and liability. Subcategories: Health Insurance: Covers medical expenses incurred due to illnesses or injuries. Includes: Individual Health Insurance: Coverage for an individual. Family Floater Policy: Single policy covering all family members. Critical Illness Insurance: Lump sum benefit on diagnosis of specified critical illnesses. Group Health Insurance: Offered by employers to their employees.

62. Motor Insurance: Covers losses related to vehicles, including: Third-Party Liability Insurance: Mandatory by law; covers damages to third parties. Comprehensive Insurance: Covers both third-party liabilities and damages to the insured vehicle. Property Insurance: Protects against damage to property due to various perils, including: Home Insurance: Covers the structure and contents of a home. Commercial Property Insurance: Covers businesses and their properties. Travel Insurance: Covers risks associated with travel, such as trip cancellations, medical emergencies, and lost luggage.

63. Marine Insurance: Covers loss or damage to ships, cargo, and terminals during transport over sea or inland waterways. Fire Insurance: Provides coverage against loss or damage due to fire and related perils. Liability Insurance: Protects against legal liabilities arising from injuries or damages to third parties, including: Public Liability Insurance: Covers legal liabilities to third parties for bodily injury or property damage. Professional Liability Insurance (Errors and Omissions): Protects professionals against claims of negligence or inadequate performance. Product Liability Insurance: Covers manufacturers against claims arising from defective products. Personal Accident Insurance: Provides compensation in case of accidents causing death, disability, or injury.

64. Reinsurance Reinsurance is a specialized form of insurance for insurers. It involves one insurance company (the reinsurer) providing financial protection to another insurance company (the ceding company) to manage risk. By understanding these categories and subcategories, individuals and businesses can choose the appropriate insurance coverage based on their specific needs and circumstances.

65. MODULE 4 Chartering A bill of lading (BL or BoL) is a legal document issued by a carrier (transportation company) to a shipper that details the type, quantity, and destination of the goods being carried. A bill of lading also serves as a shipment receipt when the carrier delivers the goods at a predetermined destination

66. The purpose of Bill of Lading (B/L) is to outline the journey of your cargo from the origin to the destination. A Bill of Lading is a document issued by a Carrier (somebody who transports and delivers goods) to a Shipper (someone who supplies and/or owns the goods – also known as a Consignor), confirming goods were received in an acceptable condition and are ready to be shipped. When the buyer is entitled to receive goods from the carrier, the bill of lading in this case performs as a document of title for the goods. In simple words, the function of BL as a document of title shows who owns the cargo. Whoever has the duly endorsed BL is the rightful owner of the cargo described in the BL.

67. Typically, there are three bills of lading, one for the shipper, one for the consignee, and one for the banker, but there is no limit to the number of bills of lading issued. Addition bills of lading increase the risk of fraud, theft, or the unauthorized release of goods. The bill of lading has three main functions: Evidence of a contract of carriage Receipt of goods i.e. an acknowledgement that the carrier has received the freight Document of legal title to goods

68. A bill of lading is a legal document that's issued by a carrier to a shipper detailing the type, quantity, and destination of the goods being carried. A bill of lading is a document of title, a receipt for shipped goods, and a contract between a carrier and a shipper. This document must accompany the shipped goods and must be signed by an authorized representative from the carrier, shipper, and receiver. A bill of lading can help prevent asset theft if it's managed and reviewed properly.

69. The bill of lading includes, for example: Party details — shipper, consignee and/or notify party Cargo description Cargo weight, package count, and volume Terms of payment Port of loading Port of discharge Bill type

70. Types of Bills of Lading Inland bill of lading. Ocean bill of lading. Through bill of lading. Negotiable bill of lading. Nonnegotiable bill of lading. Claused bill of lading. Clean bill of lading. Uniform bill of lading.

71. 1. Clean Bill of Lading:- It is issued by the Shipping Company or by its agents without any declaration on the defective Constitution of the goods/packages taken on Board/stuffed in containers. 2. Received for Shipment Bill of Lading:- It is a document that is issued by a carrier as evidence of receipt of goods for shipment. It is issued prior to the vessel loading and is therefore not an onboard bill of lading. 3. Through Bill of Lading:-. The document permits the shipping carrier to pass the cargo through several modes of transportation or through several distribution centers. This bill includes an Inland Bill of Lading and an Ocean Bill of Lading depending on the destination.

72. 4. Claused Bill of Lading:- It is issued when the cargo is damaged or when the quantity goes missing. 5. Container Bill of Lading:- It is a document that gives information about goods that are delivered in a safe container or containers from one port to another. 6. House Bill of Lading:- It is a document generated by an Ocean Transport Intermediary freight forwarder or non-vessel operating company. The document is an acknowledgment of the receipt of goods that are shipped, issued to the suppliers when the cargo is received. This Bill of Lading is also known as Forwarders Bill of Lading.

73. Master Bill of Lading:- This is a document that is created for shipping companies by their carriers as a receipt of transfer. The document specifies the terms that are required for transporting the freight, details of the consignor or the shipper, the consignee and the respective person who possesses the goods. 8. Charter Party Bill of Lading:- This is an agreement between a charterer and a vessel owner. The document is issued by the charterer of the vessel to the shipper for the goods that are shipped on board the vessel. 9. Multi-Modal Transport Document/ Combined Transport Document:- It is a type of Through Bill of Lading that involves a minimum of two different modes of transport, land or ocean. However, the modes of transportation can be anything from freight boat to air.

74. 10. Order Bill of Lading:- It is the bill that expresses words that make the bill negotiable. This explains that the delivery is to be made to the further order of the consignee using terms such as delivery to A Limited or to order or assigns. 11. Short-term/ Blank Back Bill of Lading:- It is issued when the detailed terms and conditions of the carriage contract are not given on the body of the Bill of Lading or on the back of the Bill of Lading

75. What are bill of lading clauses? A claused bill of lading is a type of bill of lading that shows that the bill of lading did not provide delivery as stated in the contract. A bill of lading is a legal document that tracks a shipment from start to finish. A claused bill of lading would indicate that the delivery included a shortfall or damaged goods What is the bill of lading Clause 14? 14. Freight and Charges. Freight shall be payable, at Carrier's option, on gross intake weight or measurement, or gross discharge weight or measurement, or ad valorem basis, or package or customary freight unit basis or any other applicable rate as set forth in Carrier's Tariff.

76. What is Article 20 bill of lading? Article 20 applies when the credit requires the presentation of a (marine/ocean) bill of lading covering transport by sea from one port to another port. It defines the mini- mum requirements as to the content of such a bill of lading to be complian t What is a Section 7 bill of lading? Section 7 on a bill of lading helps protect the shipper from being liable for freight charges if the consignee does not make payment upon delivery on collect terms. If the shipment is marked collect and the shipper signs Section 7, then the carrier can not go back to the shipper for payment

77. Bill of Lading Clauses Bill of lading clauses are standard texts used in a bill of lading. Clause texts can be preconfigured in the system, and there's also an option to add a one-time free text clause in the bill of lading. Clauses can be customized as: Mandatory: Such clauses appear in the bill of lading by default without an option to remove them. Changeable: The original clause text is derived from Customizing but it can be changed for the individual bill of lading.

78. What are the challenges / issues with bill of lading? Bill of lading errors can lead to delivery delays, payment delays, denial of claims, incidental costs incurred, and even penalties or fines. The later an error is caught, the more disruptive it will be, making it particularly vital to maintaining timely, accurate bill of lading records during the first mile . On the demand of the shipper, the carrier has a duty to record the condition and quantity of the cargo upon loading. Problems sometimes arise when the cargo is in a damaged condition or does not tally with the quantity declared by the shipper.

79. Incorrect weight and tonnage (reweight) – Common in LTL (lighter than truckload) shipping (where every pound matters), if the BOL weight doesn’t match and the carrier needs to reweigh, expect additional charges for the added tonnage. Check and double-check your BOL weights, and definitely don’t fudge the numbers. Incorrect freight class – Marking the wrong freight class could saddle you with higher fees than normal. You might be paying a rate that’s too high for what you’re shipping; or, you could end up costing your carrier fees that they pass on to you if the freight class is incorrect.

80. Incorrect billing info – Mislabeled BOLs result in delayed payments for shippers. If the BOL and payment information can’t be easily reconciled, that’s money left on the table. Even when it doesn’t result in money lost or excess fees, it’s still an unrealized expense. Accessorial not listed – Forgetting to include accessorials will drive up the shipment cost because those fees show up on the final invoice. This confuses the reconciliation process and adds headaches to the shipping process.

81. What is a Sea Waybill? A Sea Waybill is a transport contract (contract of carriage) - the same as a Bill of Lading. A Sea Waybill, however, is not needed for cargo delivery and is only issued as a cargo receipt. It can either be issued in hard copy format or soft copy format. A Sea Waybill is not negotiable and cannot be assigned to a third party. Wallenius Wilhelmsen Ocean will deliver the cargo at destination to the person or company described as Consignee in the Sea Waybill.

82. FREIGHT RATE Freight Rate, the cost of transporting goods, is reflective of a number of factors aside from normal transportation costs. The main determining factors of freight rate are: mode of transportation (truck, ship, train, air craft), weight, size, distance, points of pickup and delivery, and the actual goods being shipped. The freight rate depends on the final destination, the accountable weight of the shipment and the mode of transport selected. For instance, air carriers use dimensional weight to determine the price for the cargo.

83. Advance Freight: This is payable in advance, before delivery of the actual goods. This is generally regarded as the most important type of freight and is extensively used in the liner cargo trades and tramping. Lump sum Freight: A fixed sum is payable by the charterers for the capacity made available to them by the ship owner.

84. Dead Freight: Charge payable on space booked on a ship but not utilized by the charterer or the shipper. It is imposed at full freight rates, less loading and handling charges. E.g., if the charter party agreement was that the charterers would load 50,000 tons of wheat, but he loaded only 40,000 tons, the ship owner will claim dead freight on 10,000 tons at the agreed rate of freight. Back Freight: This arises when goods have dispatched to a certain port, and on arrival are refused. The freight charged for the return of the goods constitutes Back Freight.

85. Pro-Rata Freight: Pro-rata freight is payable in common law where only part of the voyage has been completed, e.g. when the voyage is abandoned following an outbreak of war or an accident, and the cargo is discharged at an intermediate port. It is not “freight” in the normal sense, but the ship owner’s compensation for carrying the goods at least part-way to their destination. Ad Valorem (according to the value ) Freight: Ad valorem freight is charged at a rate stated as a percentage of the value of a shipment, usually of high-value good. It is not normally used in voyage charter parties, generally being confined to liner shipments.

86. Chartering It is the term used to name the renting of a whole ship, in an agreement between a shipowner and a renting party, in this case known as charterer, intermediated by a freight forwarder or a shipbroker. The charterer is the individual or organization renting the ship.

87. What are the four types of chartering / chater party types ? The four principal methods of chartering a tramp ship are voyage charter, time charter, bareboat charter (demise ) , and contract charter . The voyage charter, in which a ship is chartered for a one-way voyage between specified ports, with a specified cargo at a negotiated rate of freight, is most common

88. In a time charter , the vessel is hired for a specific amount of time. The shipowner manages the vessel but the charterer gives orders for the employment of the vessel, and may sub-charter the vessel on a time charter or voyage charter basis. In a voyage charter, the charterer hires the vessel for a single voyage, but the shipowner provides the master, crew, bunkering and supplies.

89. In a demise (or bareboat) charter , the charterer takes responsibility for the crewing and maintenance of the ship during the time of the charter. S/he assumes the legal responsibilities of the owner, and is known as a disponent owner. In a demise charter, the charterer is the carrier; in a time or voyage charter the shipowner is the carrier).

90. TYPES DAYS IN A CHATERPARTY The days are called laydays (or laytime) and are stipulated in the charter party as working days, weather working days, running days and excepted days. If the charterer loads or discharges his cargo in less time than the number of laydays allowed, he earns dispatch money at so much a day or part of a day saved. Running days – Includes consecutive days including weekends and holidays. Working days – Includes consecutive days excluding weekends and holidays. Weather working days – Includes days on which the weather permits to continuous work of cargo loading and unloading.

91. Laydays : When the vessel on a voyage chart is in port, the expenses of the shipowner continue. At the same time loading or discharging is controlled by the charterer, who if not held to a definite number of days to complete this work, can make the stay in port long and expensive for the shipowner. For this reason, the charter party will specify a definite number of days for loading or discharging cargo; or it may specify a certain number of tons per day to be loaded or discharged.

92. If the charterer loads or discharges his cargo in less time than the number of laydays allowed, he earns dispatch money at so much a dayor part of a day saved. If he takes longer to load or discharge than the number of laydays allowed, he must pay demurrage at so much a day. Both dispatch and demurrage may be the cause of much disagreement and argument in which the vessel's logbook can play an important part.

93. WORKING DAY shall mean a Day when by local law or practice work is normally carried out. RUNNING DAYS or CONSECUTIVE DAYS shall mean Days which follow one immediately after the other. RUNNING HOURS or CONSECUTIVE HOURS shall mean hours which follow one immediately after the other. HOLIDAY shall mean a Day other than the normal weekly Day(s) of rest, or part thereof, when by local law or practice work during what would otherwise be ordinary working hours is not normally carried out. WEATHER WORKING DAY shall mean a Working Day or part of a Working Day during which it is or, if the Vessel is still waiting for her turn, it would be possible to load/discharge the cargo without interruption due to the weather. If such interruption occurs (or would have occurred if work had been in progress), there shall be excluded from the Laytime a period calculated by reference to the ratio which the duration of the interruption bears to the time which would have or could have been worked but for the interruption.

94. WEATHER WORKING DAY OF 24 CONSECUTIVE HOURS shall mean a Working Day or part of a Working Day of 24 consecutive hours during which it is or, if the vessel is still waiting for her turn, it would be possible to load/discharge the cargo without interruption due to the weather. If such interruption occurs (or would have occurred if work had been in progress) there shall be excluded from the Laytime the period during which the weather interrupted or would have interrupted work. WEATHER WORKING DAY OF 24 HOURS shall mean a period of 24 hours made up of one or more Working Days during which it is or, if the Vessel is still waiting for her turn, it would be possible to load/discharge the cargo without interruption due to the weather. If such interruption occurs (or would have occurred if work had been in progress), there shall be excluded from Laytime the actual period of such interruption.

95. . (WORKING DAY) WEATHER PERMITTING shall have the same meaning as WEATHER WORKING DAY OF 24 CONSECUTIVE HOURS. EXCEPTED or EXCLUDED shall mean that the Days specified do not count as Laytime even if loading or discharging is carried out on them.

96. In Charter When a vessel is "in charter," it means that the vessel has been hired or leased by a company or individual (the charterer) from the vessel owner for a specified period or voyage. The charterer pays a fee, known as charter hire, to the vessel owner for the use of the ship. During the in-charter period, the charterer is responsible for operating the vessel and bears most operational costs, such as fuel and port charges. There are different types of in charters: Time Charter: The charterer leases the vessel for a specific period. Voyage Charter: The charterer leases the vessel for a specific voyage. Bareboat Charter (or Demise Charter): The charterer leases the vessel without crew, provisions, or any operational responsibilities, taking full control of the vessel.

97. Out Charter When a vessel is "out charter," it means that the vessel owner has leased out their vessel to a charterer. The vessel owner receives the charter hire fee from the charterer. The specific responsibilities and costs covered by the vessel owner and the charterer depend on the type of charter agreement. In summary: In Charter: A company or individual leases a vessel from the owner. Out Charter: The vessel owner leases out their vessel to a charterer.

98. fixation of vessel voyage estimate The fixation of a vessel voyage estimate in the marine industry involves the process of negotiating and finalizing the terms for a vessel's voyage charter. This process includes estimating various costs, revenues, and operational details to determine the feasibility and profitability of the voyage. Here are the key steps involved in fixing a vessel voyage estimate: 1. Voyage Planning Route and Ports: Determine the route and the ports of loading and discharge. Cargo Details: Identify the type, quantity, and handling requirements of the cargo. 2. Estimation of Costs Fuel Costs: Estimate the cost of bunker fuel based on the distance and fuel consumption rate. Port Charges: Calculate port dues, pilotage, towage, berthage, and other port-related expenses. Canal Transit Fees: If applicable, include fees for canals like the Suez or Panama Canal. Crew Costs: Include wages, insurance, and other crew-related expenses. Maintenance and Repairs: Estimate any necessary maintenance or repairs during the voyage. Insurance: Calculate the cost of insurance for the vessel and cargo. Miscellaneous Costs: Include other expenses such as agency fees, communication costs, and provisions.

99. Estimation of Revenues Freight Rate: Determine the freight rate based on market conditions, cargo type, and route. Demurrage and Dispatch: Estimate potential demurrage (penalty for delays) or dispatch (reward for early completion) fees. 4. Risk Assessment Market Conditions: Assess the current market conditions and potential fluctuations in freight rates and fuel prices.

100. Negotiation Contract Terms: Negotiate the terms of the charter party agreement, including laytime, demurrage, and dispatch terms. Clauses: Include important clauses like force majeure (unforeseen event) and dispute resolution. 6. Finalization Agreement: Finalize and sign the charter party agreement, detailing all the terms and conditions agreed upon. Documentation: Ensure all necessary documentation, such as bills of lading and certificates, are prepared and ready.

101. Example of Voyage Estimation Calculation : Cargo Details: 50,000 metric tons of grain. Route: From Port A to Port B. Distance: 5,000 nautical miles. Fuel Consumption: 50 metric tons per day. Fuel Cost: ₹45,000 per metric ton. Port Charges: ₹7,500,000 at each port. Freight Rate: ₹1,500 per metric ton. Time Estimate: 20 days at sea + 5 days loading/unloading.

102. Costs : Fuel: 20 days x 50 tons/day x ₹45,000/ton = ₹45,000,000 Port Charges: 2 x ₹7,500,000 = ₹15,000,000 Crew, maintenance, insurance, etc.: ₹7,500,000 Total Costs in INR: ₹67,500,000 Revenue : Freight: 50,000 tons x ₹1,500/ton = ₹75,000,000 Profit Calculation Profit in INR: ₹75,000,000 - ₹67,500,000 = ₹7,500,000

103. Who is a Marine Surveyor? A marine surveyor is a professionally qualified individual who is responsible for surveying various marine vessels, such as ships, boats, and yachts. He conducts inspections and surveys to assess the vessel's condition and the equipment installed therein. A surveyor is a highly qualified inspector who is also responsible for carrying out detailed evaluations of damages for marine insurance purposes. They are qualified professionals who ascertain a vessel's seaworthiness by implementing various survey methods. The post of surveyor demands excellent technical know-how and in-depth knowledge of the vessel's hull, marine engines, electrical systems, and other related areas.

104. What are the Responsibilities & Duties of a Surveyor? Inspecting the Vessels- The primary and most important responsibility of a marine surveyor is to inspect and assess the condition of the vessels. Only after a report from the surveyor, is it decided whether the vessel is fit to venture into the sea or not. Inspection of the Cargo- Apart from inspecting the marine vessels, a surveyor also examines, inspects, and assesses the cargo or goods. Maintaining a record of the Vessels—One of the surveyor's duties is to maintain all the essential records of the ship. All the necessary information regarding the interior and exterior of the vessels is stored in photos or videos. Inspecting the Maintenance Records— A surveyor is also required to inspect the ship's maintenance records closely and ensure that all the rules and procedures are followed appropriately. Equipment Testing- A craft surveyor also checks the functioning of the vessel mechanisms and machinery to ensure they are working without any disruption.

105. Types of Marine Surveyors Since the marine industry is vast and diverse, there are various types of marine hull surveyors who have specialised roles to perform. Here are the types of surveyors and the tasks they perform: Government Surveyor- He is responsible for carrying out surveys on ship registration and implementing ship safety standards. Cargo Surveyor- Cargo owners appoint surveyors to inspect the cargo to ensure its quality and quantity. Classification Surveyor- The classification society appoints them to ensure that a vessel's machinery and mechanisms adhere to the pre-set regulations. Small Craft and Yacht Surveyor—These surveyors are responsible for inspecting smaller crafts and vessels (less than 24 metres) that are often used for pleasure sailing.