CHAPTER LXXVIII.

MARINE INSURANCE.

1. INSURANCE is a contract whereby one party, for a stipulated consideration, undertakes to indemnify another party in case of loss by certain risks. The party undertaking to make the indemnity, is called the insurer, or underwriter. The party indemnified, is called the insured. The stipulated consideration, is called the premium. The written contract, is called the policy of insurance. There are three kinds of insurance—fire, life, and marine insurance. The contract of fire insurance, is one by which the insurers undertake to indemnify the insured in case of loss or damage by fire to the property covered by the policy, during a prescribed period of time. The contract of life insurance, is one by which the insurers undertake to indemnify the insured in case of the death of the party whose life is the object of insurance, during a prescribed period of time. The contract of marine insurance, is one by which the insurers undertake to indemnify the insured in case of loss, by the perils of the sea, to the property covered by the policy, during a prescribed period of time.

2. The principle of insurance may be thus stated: If one house in every hundred be annually destroyed by fire, the probability of loss will be one per cent. If, therefore, a party wishes to get a house insured, he ought

1. What is insurance? What is the party undertaking to make the indemnity called? The party indemnified? What is the stipulated consideration called? What is the written contract called? How many kinds of insurance are there? What is the contract of fire insurance? What is the contract of life insurance? What is the contract of marine insurance?

2. How may the principle of insurance be stated? If a party wishes to get a house insured, what annual premium ought he to pay? By

to pay an annual premium of one per cent on the amount insured, in addition to such sum as may be required to compensate the insurer for his trouble, and leave him a fair profit. Insurances are generally undertaken by insurance companies. The richest and most abundant sources from which the law of insurance, as it now exists, is derived, are the adjudged cases in the reported decisions of the courts of common law in the United States and in England.

3. Marine insurance companies generally insure on the representations of the insured. The most perfect good faith is required in the contract. If the insured make false representations to the company, in order to procure an insurance on better terms, it will avoid the contract, though the loss may arise from causes unconnected with the misrepresentations. If there is any concealment on the part of the insured, even if the concealment happen through mistake, neglect, or accident, without any fraudulent intention, it will avoid the contract, for the reason that the insurer was not the less deceived. All persons may be insured, whether citizens or foreigners, except alien enemies. A marine policy may be made to some particular individual, or "for whom it may concern."

4. The thing insured must be actually exposed to the risk, and the insurer must receive an equivalent for the chances of loss. Whatever may be liable to injury by the perils of the sea, either in whole or in part, may be insured. Those who have a qualified property, as well as those who have an absolute property, are at liberty to insure it. The mortgagor and mortgagee have each an insurable interest.

whom are insurances generally undertaken? What are the sources from which the law of insurance is derived?

3. On what representations do marine insurance companies insure? What is required in the contract? If the insured make false representations to the company, in order to procure insurance on better terms? If there is any concealment on the part of the insured? Who may be insured? To whom may a marine policy be made?

4. To what must the thing insured be exposed? What must the insurer receive? What may be the subject of marine insurance? If a person has a qualified property only? If there be a mortgagor and

The insurer has an insurable interest, and may reinsure against the same risk. The insured may make a second or double insurance on the same risk, and in case of loss may sue on both policies. The insurers on the different policies are bound to contribute ratably towards the loss, unless a clause is introduced in the policy, making the insurers responsible in the order of their in

surance.

5. There is an implied agreement in every contract of marine insurance, on the part of the insured, that the vessel is seaworthy at the commencement of the voyage; that the voyage shall not be changed without the consent of the underwriters; and that the vessel shall be employed and navigated with reasonable skill, and according to law. By seaworthiness, is meant the ability of the ship to make a voyage with probable success and safety. There is an implied agreement on the part of the insured, that at the commencement of the voyage, the ship is tight, staunch, and strong, properly manned, provided with stores, and in all respects fit for the intended voyage. This implied seaworthiness relates only to the commencement of the voyage. If she sail without a competent number of hands to navigate her; or if she be suffered to sail in a river, channel, or other place of difficult navigation, without a pilot properly qualified, the underwriters will be discharged from liability. Whether or not the vessel was seaworthy when she sailed, is a question of fact for the jury.

mortgagee, which may insure? Has an insurer an insurable interest? Can the insurer make a double insurance on the same risk? In case of loss, which is liable? What are the insurers on the different policies bound to do?

5. What implied agreement is there in every policy of marine insurance, on the part of the insured? What is meant by seaworthiness? What is the implied agreement, on the part of the insured, as to the condition of the vessel at the commencement of the voyage? If she sail without a sufficient number of hands to navigate her? If she sail in a narrow channel, or other place of difficult navigation, without a pilot properly qualified? By whom is the question whether the vessel was seaworthy or not when she sailed, to be determined?

6. The vessel must have her proper documents, to prove her nationality. She must be employed in a lawful voyage, according to the law of nations, municipal law, and particular treaties between the country to which she belongs and other States. The voyage is from the port of departure to the port of final destination. None but a lawful voyage can be insured. If the voyage were illegal, the insurance is void, whether the insurers were informed of the illegality or not.

7. By the voyage is meant the regular and customary track from the port of departure to the port of destination. A deviation from the voyage, unless justifiable, will discharge the underwriters. A deviation from the voyage is 1. A voluntary departure, without necessity or reasonable cause, from the regular and usual course of the voyage insured; 2. Remaining at a place where the ship is allowed to touch, longer than necessary; 3. Doing there what the insured is not authorized to do, as remaining to trade where she is allowed only to touch; 4. Captured and released, and remaining in port to trade. A deviation may be justified-1. By stress of weather; 2. By want of necessary repairs; 3. For the purpose of rendering succor to a ship in distress, with the object of saving life, but not of saving property; 4. For the purpose of avoiding capture or detention, when there is sufficient. danger; 5. By the inability of the captain and crew to navigate the ship in safety, from sickness, death, or other cause; but this inability must not arise from the neglect or mismanagement of the owners or master; 6. When the captain departs from his course by compulsion, on account of the mutiny of the crew. The liability of the underwriters ceases at the time of the deviation. If a

6. What documents must the vessel have? How must she be employed? What is the voyage? What voyage only can be insured? If the voyage were illegal?

7. On what track is the voyage? What is the effect of a deviation from the voyage, if not justifiable? What is a deviation from the voyage? By what may a deviation be justified? When does the liability of the underwriters cease? If a loss occurred before? If after the de

loss occurs before, they are responsible. If after, they are not. If there be an unnecessary deviation, the underwriters are entitled to retain the whole premium. The slightest unauthorized deviation changes the voyage.

8. The risks usually insured against are those occasioned by storm, shipwreck, jettison, prize, pillage, fire, war, reprisal, detention by foreign governments, collision at sea, whether resulting from accident or negligence. These are called perils of the sea. The insurer may by a special contract limit his responsibility to enumerated risks. No one is permitted to protect himself by insurance—1. Against a loss or damage resulting from his own fault; 2. Against perils of the sea in a voyage prohibited by law; 3. Against risks excluded by the usual memorandum contained in the policy. In marine insurance, the acci dent must have happened at sea, unless the policy includes other risks. The commencement and end of the risk depends upon the words of the policy. The policy may be on the voyage out, or on the voyage in, or on any part of the voyage, or for a limited time, or from port to port. When the vessel has left her moorings, in complete readi ness for sea, and the master has an actual intention of proceeding, she is at sea, or on her passage, within the' meaning of the policy. The vessel moving out into the river has not necessarily sailed on her voyage. The intention of sailing decides the point. The voyage does not end until the vessel drops her anchor, or is moored.

9. The policy must be in writing. The names of the parties, insurer and insured, should be inserted. The

viation? If there be unjustifiable deviation, who is entitled to the premium? If there be the slightest unauthorized deviation?

8. What are some of the risks usually insured against? What are these risks called? To what may the insurer limit his responsibility? How? Against what is no one permitted to protect himself by insurance? Where must the accident happen, in marine insurance? Upon what does the commencement and end of the risk depend? Upon what may the policy be? When is a vessel at sea, or on her voyage? If a vessel move out into the river? What must decide the point? When does the voyage end?

9. Must the policy be in writing? What names must be inserted?