Project on Marine Insurance With Reference To New India Assurance Company Ltd

Chapter I INTRODUCTION

1.0 Insurance is the equitable transfer of the risk of a loss, from one entity to another in exchange for payment. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. An insurer, or insurance carrier, is a company selling the insurance; the insured, or policyholder, is the person or entity buying the insurance policy. The amount to be charged for a certain amount of insurance coverage is called the premium. Risk management, the practice of appraising and controlling risk, has evolved as a discrete field of study and practice. The transaction involves the insured assuming a guaranteed and known relatively small loss in the form of payment to the insurer in exchange for the insurer's promise to compensate (indemnify) the insured in the case of a financial (personal) loss. The insured receives a contract, called the insurance policy, which details the conditions and circumstances under which the insured will be financially compensated. The Life is full of uncertainties. People opt for insurance purely for the reasons of uncertainties in life. Insurance gives the insured a kind of peace of mind as he is assured to making up the loss in the event of such uncertainties in life happen.

The New India Assurance Co. Ltd., based in Mumbai, is one of the five public sector insurance companies in India. It is the "largest general insurance company of India on the basis of gross premium collection inclusive of foreign operations". It was founded by Dorab Tata in 1919, and nationalized in 1973. Previously it was a subsidiary of the General Insurance Corporation of India (GIC). But when GIC became a reinsurance company as per the IRDA Act 1999, its four primary insurance subsidiaries New India Assurance, United India Insurance, Oriental Insurance and National Insurance got autonomy. New India Assurance provides Marine Insurance Policy as well as the shipping Cargo policy which helps to recover the damage to the ships and the goods during the travel from origin to the destination. This policy covers goods, freight and other interests against loss or damage to goods whilst being transported by rail, road, sea and/or air.

1.1 OBJECTIVES OF THE STUDY i) To determine and analyze the Market Potential of the New India Assurance Co. Ltd. ii) To determine whether the customers are satisfied with the Marine insurance policies of the company. iii) To know the customer awareness regarding the New India Assurance Co. Ltd and its products. iv)To study and determine the competitor position in the market. v) To know the future plans of the people for buying the marine insurance policies.

1.2 REVIEW OF LITERATURE

1. Jackson Mark, 11 Jan, 2013. The intention behind covering piracy in the hull and cargo claims is to prevent the stunting of trade and trade routes for reasons like barbaric activities. The understanding of the term piracy and pirates has gone far ahead to include passengers who mutiny and rioters who attack the ship even from the shores. The widely recognized hull and cargo clauses cover the issues of piracy. According to the Marine Insurance Act, 1963 (India), the term "pirates" includes passengers who mutiny and rioters who attack the ship from the shore. Anyhow, piracy is excluded from the paramount war exclusion clause of ITCH and IVCH. The test to be applied in this regard is that of proximate cause whereby the loss that has been incurred should not have been caused by barratry or piracy. However, any loss caused by seizure, even if the seizure were to result from a barratrous or piratical act, is not excluded from the war exclusion clause. There may not be a situation where in the clause of piracy as such may stand deleted from the marine insurance policies. But the situations demand that the insurers should increase the costs of insurance on account of piracy, especially relating to notorious routes of the times like Somalia, Indonesia, and Philippines etc.

2. Roshan Sahasrabuddhe, Jan 2013 stated that The Indian general insurance industry is likely to grow by around 20% per annum in the coming years because of increasing penetration, a top official of New India Assurance said. "Despite slowdown in economy, the general insurance industry has grown by around 20% in the recent past. We hope the industry will see similar growth in the coming years," Chairman and Managing Director of New India Assurance G Srinivasan said. The penetration o the general insurance in India stands at around 0.7%, lower than the global average of 1.5-4%.

3. Nikhil Walavalkar (Jan 7, 2013) gives his reviews as The Indian general insurance industry is likely to grow by around 20% per annum in the coming years because of increasing penetration, a top official of New India Assurance said. "Despite slowdown in economy, the general insurance industry has grown by around 20% in the recent past. We hope the industry will see similar growth in the coming years," Chairman and Managing Director of New India Assurance G Srinivasan said. The penetration o the general insurance in India stands at around 0.7%, lower than the global average of 1.5-4%.

4. Shiply Sinha (April 12, 2006) gives reviews: Good performance of ICICI Lombard, New India, Oriental Insurance and Bajaj Allianz, pushed the general insurance industry growth to 16% in April-February of '06. The 12 non-life players
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together mopped up Rs 18,414 crore in premium till February last fiscal even as National Insurance (NIC) and Reliance General continued to see decline in business, according to data compiled by IRDA. Market leader New India Assurance collected Rs 4,281 crore in first year premium by logging 15% growth to corner 23.3% of the market. Kolkata-based NIC was at second spot despite seeing 6.5% decline in premium income at Rs 3,202 crore and had a market pie of 17.4%. Delhi-based Oriental Insurance was close behind NIC by collecting Rs 3,200 crore in premium and a market share of 17.4%. United India Insurance grew by mere 5.7% to garner 15.4% of the market after it collected Rs 2,839 crore in premium.

1.3 HYPOTHESIS i) The new technologies adopted by the New India Assurance Co. Ltd acts as a tool for improving the performance of the company. ii) It has reduced the role of other Private sector insurance companys & made the Marine insurance policies which are effective to the customers.

1.4 METHEDODLOGY Study of Secondary data The secondary data required for the study are obtained from books, journals, officials reports; periodicals brought by the Government of India in addition to these, efforts would be made to collect as much information from the internet about the Marine Insurance Industries in India.
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1.5 LIMITATIONS OF THE STUDY Though this study is purely explorative in nature, it is brought with a number of limitations. The most outstanding among them could be listed as follows. i) Adequate secondary data are not available regarding financial aspects of New India Assurance Co. Ltd. ii) This study concentrates more on the role and performance of New India Assurance Co. Ltd without considering the role played by the company in life insurance sector. iii) This study does not analyze the problems faced by the customers. iv)Study of primary data is not available.

Chapter II MEANING OF INSURANCE

2.0 Insurance is the equitable transfer of the risk of a loss, from one entity to another in exchange for payment. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. An insurer, or insurance carrier, is a company selling the insurance; the insured, or policyholder, is the person or entity buying the insurance policy. The amount to be charged for a certain amount of insurance coverage is called the premium. Risk management, the practice of appraising and controlling risk, has evolved as a discrete field of study and practice. The transaction involves the insured assuming a guaranteed and known relatively small loss in the form of payment to the insurer in exchange for the insurer's promise to compensate (indemnify) the insured in the case of a financial (personal) loss. The insured receives a contract, called the insurance policy, which details the conditions and circumstances under which the insured will be financially compensated. Insurance is a form of risk management in which the insured transfers the cost of potential loss to another entity in exchange for monetary compensation known as premium. Insurance allows individuals, businesses and other entities to protect
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themselves against significant potential losses and financial hardship at a reasonably affordable rate. We say "significant" because if the potential loss is small, then it doesn't make sense to pay a premium to protect against the loss. After all, you would not pay a monthly premium to protect against a $50 loss because this would not be considered a financial hardship for most. Insurance is a technique wherein a number of people, who are exposed to similar risk, participate in the scheme and contribute in the shape of periodic premiums. Such premiums are received by the insurer who is able to pay out of the premiums received by him, for the losses of some of those who have participated in the scheme. Thus it is wonderful technique of spreading and transfer or risks. Everyone that wants to protect themselves or someone else against financial hardship should consider insurance. This may include:

Protecting family after one's death from loss of income Ensuring debt repayment after death Covering contingent liabilities Protecting against the death of a key employee or person in your business Buying out a partner or co-shareholder after his or her death Protecting your business from business interruption and loss of income Protecting yourself against unforeseeable health expenses Protecting your home against theft, fire, flood and other hazards Protecting yourself against lawsuits Protecting yourself in the event of disability

Protecting your car against theft or losses incurred because of accidents And many more

2.1 ORIGIN OF INSURANCE Whenever there is uncertainty there is risk. We do not have any control over uncertainties which involves financial losses. The risk may be certain events like death, pension, retirement or uncertain events like theft, fire, accident; etc. Insurance is a financial service for collecting the savings of the public and providing them with risk coverage. It comes under service sector and while marketing this service due care is taken in quality product and customer satisfaction. The main function of the Insurance is to provide protection against the possible chances of generating losses. The insurance sector in India has come a full circle from being an open competitive market to nationalization and back to a liberalized market again. Tracing the developments in the Indian insurance sector reveals the 360-degree turn witnessed over a period of almost two centuries. In some sense we can say that insurance appears simultaneously with the appearance of human society. We know of two types of economies in human societies: natural or non-monetary economies and more modern monetary economies (with markets, currency, financial instruments and so on). The former is more primitive and the insurance in such economies entails agreements of mutual aid. If one family's house is destroyed the neighbors are committed to help rebuild.

2.2 HISTORY OF INSURANCE

Turning to insurance in the modern sense (i.e., insurance in a modern money economy, in which insurance is part of the financial sphere), early methods of transferring or distributing risk were practiced by Chinese and Babylonian traders as long ago as the 3rd and 2nd millennia BC, respectively. Chinese merchants travelling treacherous river rapids would redistribute their wares across many vessels to limit the loss due to any single vessel's capsizing. The Babylonians developed a system which was recorded in the famous Code of Hammurabi, c. 1750 BC, and practiced by early Mediterranean sailing merchants. If a merchant received a loan to fund his shipment, he would pay the lender an additional sum in exchange for the lender's guarantee to cancel the loan should the shipment be stolen or lost at sea. The business of life insurance in India in its existing form started in India in the year1818 with the establishment of the Oriental Life Insurance Company in Calcutta. Some of the important milestones in the life insurance business in India are: 1912: The Indian Life Assurance Companies Act enacted as the first statute to regulate the life insurance business. 1928: The Indian Insurance Companies Act enacted to enable the government to collect statistical information about both life and non-life insurance businesses. 1938: Earlier legislation consolidated and amended to by the Insurance Act with the objective of protecting the interests of the insuring public. 1956: 245 Indian and foreign insurers and provident societies taken over by the central government and nationalized. LIC formed by an Act of Parliament, viz. LIC Act, 1956,with a capital contribution of Rs. 5 crore from the Government of India. The General insurance business in India, on the other hand, can trace its roots to the Triton Insurance Company Ltd., the first general insurance company established in the year 1850 in Calcutta by the British.
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Some of the important milestones in the general insurance business in India are: 1907: The Indian Mercantile Insurance Ltd. set up, the first company to transact all classes of general insurance business. 1957: General Insurance Council, a wing of the Insurance Association of India, frames a code of conduct for ensuring fair conduct and sound business practices. 1968: The Insurance Act amended to regulate investments and set minimum solvency margins and the Tariff Advisory Committee set up. 1972: The General Insurance Business (Nationalization) Act, 1972 nationalized the general insurance business in India with effect from 1st January 1973. 107 insurers amalgamated and grouped into four companies viz. the National Insurance Company Ltd., the New India Assurance Company Ltd., the Oriental Insurance Company Ltd. and the United India Insurance Company Ltd. GIC incorporated as a company. 2.3 PRINCIPLES OF INSURANCE Insurance involves pooling funds from many insured entities (known as exposures) to pay for the losses that some may incur. The insured entities are therefore protected from risk for a fee, with the fee being dependent upon the frequency and severity of the event occurring. In order to be insurable, the risk insured against must meet certain characteristics in order to be an insurable risk. Insurance is a commercial enterprise and a major part of the financial services industry, but individual entities can also self-insure through saving money for possible future losses.

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 Utmost Good Faith

Principle of Utmost Good Faith is a very basic and first primary principle of insurance. According to this principle, the insurance contract must be signed by both parties (i.e. insurer and insured) in an absolute good faith or belief or trust. The person getting insured must willingly disclose and surrender to the insurer his complete true information regarding the subject matter of insurance. The insurer's liability gets void (i.e. legally revoked or cancelled) if any facts, about the subject matter of insurance are either omitted, hidden, falsified or presented in a wrong manner by the insured. Insurable Interest The principle of insurable interest states that the person getting insured must have insurable interest in the object of insurance. A person has an insurable interest when the physical existence of the insured object gives him some gain but its non12

existence will give him a loss. In simple words, the insured person must suffer some financial loss by the damage of the insured object. For example: - The owner of a taxicab has insurable interest in the taxicab because he is getting income from it. But, if he sells it, he will not have an insurable interest left in that taxicab. Principle Of Indemnity Indemnity means security, protection and compensation given against damage, loss or injury. According to the principle of indemnity, an insurance contract is signed only for getting protection against unpredicted financial losses arising due to future uncertainties. Insurance contract is not made for making profit else its sole purpose is to give compensation in case of any damage or loss. In an insurance contract, the amount of compensations paid is in proportion to the incurred losses. The amount of compensations is limited to the amount assured or the actual losses, whichever is less. The compensation must not be less or more than the actual damage. Compensation is not paid if the specified loss does not happen due to a particular reason during a specific time period. Thus, insurance is only for giving protection against losses and not for making profit. However, in case of life insurance, the principle of indemnity does not apply because the value of human life cannot be measured in terms of money. Principle Of Contribution Principle of Contribution is a corollary of the principle of indemnity. It applies to all contracts of indemnity, if the insured has taken out more than one policy on the same subject matter. According to this principle, the insured can claim the compensation only to the extent of actual loss either from all insurers or from any
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one insurer. If one insurer pays full compensation then that insurer can claim proportionate claim from the other insurers. Principle Of Subrogation Subrogation means substituting one creditor for another. Principle of Subrogation is an extension and another corollary of the principle of indemnity. It also applies to all contracts of indemnity. According to the principle of subrogation, when the insured is compensated for the losses due to damage to his insured property, then the ownership right of such property shifts to the insurer. This principle is applicable only when the damaged property has any value after the event causing the damage. The insurer can benefit out of subrogation rights only to the extent of the amount he has paid to the insured as compensation. Principle Of Loss Minimization According to the Principle of Loss Minimization, insured must always try his level best to minimize the loss of his insured property, in case of uncertain events like a fire outbreak or blast, etc. The insured must take all possible measures and necessary steps to control and reduce the losses in such a scenario. The insured must not neglect and behave irresponsibly during such events just because the property is insured. Hence it is a responsibility of the insured to protect his insured property and avoid further losses. Principle Of Causa Proxima Principle of Causa Proxima (a Latin phrase), or in simple English words, the Principle of Proximate (i.e. Nearest) Cause, means when a loss is caused by more than one causes, the proximate or the nearest or the closest cause should be taken
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into consideration to decide the liability of the insurer. The principle states that to find out whether the insurer is liable for the loss or not, the proximate (closest) and not the remote (farest) must be looked into. For example: - A cargo ship's base was punctured due to rats and so sea water entered and cargo was damaged. Here there are two causes for the damage of the cargo ship - (i) The cargo ship getting punctured because of rats, and (ii) The sea water entering ship through puncture. The risk of sea water is insured but the first cause is not. The nearest cause of damage is sea water which is insured and therefore the insurer must pay the compensation. However, in case of life insurance, the principle of Causa Proxima does not apply. Whatever may be the reason of death (whether a natural death or an unnatural death) the insurer is liable to pay the amount of insurance.

2.4 TYPES OF INSURANCE

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1. Life Insurance Life insurance provides a monetary benefit to a decedent's family or other designated beneficiary, and may specifically provide for income to an insured person's family, burial, funeral and other final expenses. Life insurance policies often allow the option of having the proceeds paid to the beneficiary either in a lump sum cash payment or an annuity. Annuities provide a stream of payments and are generally classified as insurance because they are issued by insurance companies, are regulated as insurance, and require the same kinds of actuarial and investment management expertise that life insurance requires. Annuities and pensions that pay a benefit for life are sometimes regarded as insurance against the possibility that a retiree will outlive his or her financial resources. In that sense, they are the complement of life insurance and, from an underwriting perspective, are the mirror image of life insurance. Certain life insurance contracts accumulate
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cash values, which may be taken by the insured if the policy is surrendered or which may be borrowed against. Some policies, such as annuities and endowment policies, are financial instruments to accumulate or liquidate wealth when it is needed. In the US, the tax on interest income on life insurance policies and annuities is generally deferred. However, in some cases the benefit derived from tax deferral may be offset by a low return. 2. General Insurance Also known as non-life insurance, general insurance is normally meant for a shortterm period of twelve months or less. General insurance means managing risk against financial loss arising due to fire, marine or miscellaneous events as a result of contingencies, which may or may not occur. Recently, longer-term insurance agreements have made an entry into the business of general insurance but their term does not exceed five years. General insurance can be classified as follows: Fire Insurance Fire insurance provides protection against damage to property caused by accidents due to fire, lightening or explosion, whereby the explosion is caused by boilers not being used for industrial purposes. Fire insurance is a contract under which the insurer in return for a consideration (premium) agrees to indemnify the insured for the financial loss which the latter may suffer due to destruction of or damage to property or goods, caused by fire, during a specified period. The contract specifies the maximum amount, agreed to by the parties at the time of the contract, which the insured can claim in case of loss. This amount is not, however, the measure of the loss. The loss can be ascertained only after the fire has occurred. The insurer is

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liable to make good the actual amount of loss not exceeding the maximum amount fixed under the policy. A fire insurance policy cannot be assigned without the permission of the insurer because the insured must have insurable interest in the property at the time of contract as well as at the time of loss. The insurable interest in goods may arise out on account of (i) ownership, (ii) possession, or (iii) contract. A person with a limited interest in a property or goods may insure them to cover not only his own interest but also the interest of others in them. Marine Insurance Marine insurance basically covers three risk areas, namely, hull, cargo and freight. The risks which these areas are exposed to are collectively known as "Perils of the Sea". These perils include theft, fire, collision etc. Marine Cargo: Marine cargo policy provides protection to the goods loaded on a ship against all perils between the departure and arrival warehouse. Therefore, marine cargo covers carriage of goods by sea as well as transportation of goods by land. Marine Hull: Marine hull policy provides protection against damage to ship caused due to the perils of the sea. Marine hull policy covers three-fourth of the liability of the hull owner (shipowner) against loss due to collisions at sea. The remaining 1/4th of the liability is looked after by associations formed by ship-owners for the purpose (P and I clubs). Miscellaneous As per the Insurance Act, all types of general insurance other than fire and marine insurance are covered under miscellaneous insurance. Some of the examples of general insurance are motor insurance, theft insurance, health insurance, personal accident insurance, money insurance, engineering insurance etc. Miscellaneous
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Insurance refers to contracts of insurance other than those of Life, Fire and Marine insurance. It covers a variety of risks, the chief of which are:Personal Accident insurance: - Personal Accident insurance is insurance for individuals or groups of persons against any personal accident or illness. The risk insured is the bodily injury resulting solely and directly from accident caused by violent, external and visible means. In India this type of insurance is done by the General Insurance Corporation. A contract of personal accident insurance is not a contract of indemnity and the insurer has to pay a fixed sum of money on the death or total disablement of the insured or provide medical benefits for recovery from the injury. If risks against certain specified diseases are also covered, the policy is known as 'Personal Accident and Sickness Insurance. Motor Vehicle Insurance: - under it, a personal or commercial vehicle is subjected to combined insurance against the risks of :- (i) loss or damage to the motor vehicle and its accessories on account of accident or theft; (ii) death of or injury to the owner or passenger of the vehicle due to accident; (iii) damages payable to third parties by the owner of the vehicle for accident. A comprehensive insurance policy may be taken to cover all these risks. Insurance against the first two types of risks is optional. But every owner of motor vehicle is required to take out an insurance policy to cover the third party risks under the Motor Vehicles Act, 1956. Such a policy is known as 'third party insurance or liability insurance'. Under such a policy, the third party who has suffered any loss can sue the insurer directly even though he was not a party to the contract of insurance. This policy provides insurance cover to owners of the vehicle, financiers or lessee, who have insurable interest in a motor vehicle.

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Fidelity Insurance: - under it, the insurer undertakes to compensate the insured i.e. the employers against the losses suffered by him due to the employees. The losses may be due to fraud, dishonesty, and misappropriation of funds, goods or damages to property caused by the employees. In order to avail the protection under it, the employer is required to provide all material facts about their employees to the insurer and also, notify all changes in the condition of their service. Credit Insurance: - Credit Insurance is a policy taken to cover the loss which may arise due to bad debts or non-payment of dues by the debtors. It provides protection to businessmen, who sell goods on credit terms while substantially reducing the overall risk of exposure to non-payment. It protects them against losses arising out of insolvency of their debtors. It thus enables a business to take advantage of peak and cyclical selling periods and to safely expand into new product lines or territories. Travel insurance: - Travel insurance provides protection cover to all those individuals travelling outside India against risks such as loss of baggage, travel related accidents including injuries, illnesses and medical emergencies requiring hospitalization treatment. In India, this insurance policy has become popular among International travelers.

2.5 SOME PLAYERS IN THE INSURANCE INDUSTRY

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Chapter III MARINE INSURANCE

3.0 Marine insurance covers the loss or damage of ships, cargo, terminals, and any transport or cargo by which property is transferred, acquired, or held between the points of origin and final destination. Cargo insurance discussed here is a sub-branch of marine insurance, though Marine also includes Onshore and Offshore exposed property (container terminals, ports, oil platforms, pipelines); Hull; Marine Casualty; and Marine Liability. Maritime insurance was the earliest well-developed kind of insurance, with origins in the Greek and Roman maritime loan. Separate marine insurance contracts were developed in Genoa and other Italian cities in the fourteenth century and spread to northern Europe. Premiums varied with intuitive estimates of the variable risk from seasons and pirates. In the 19th century, Lloyd's and the Institute of London Underwriters (a grouping of London company insurers) developed between them standardized clauses for the use of marine insurance, and these have been
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maintained since. These are known as the Institute Clauses because the Institute covered the cost of their publication. Within the overall guidance of the Marine Insurance Act and the Institute Clauses parties retain a considerable freedom to contract between themselves. A contract of marine insurance is an agreement whereby the insurer undertakes to indemnify the assured, in the manner and to the extent agreed, against losses incidental to marine adventure. There is a marine adventure when any insurable property is exposed to maritime perils i.e. perils consequent to navigation of the sea. The term 'perils of the sea' refers only to accidents or causalities of the sea, and does not include the ordinary action of the winds and waves. Besides, maritime perils include, fire, war perils, pirates, seizures and jettison, etc.

3.1 IDEMNITY A marine policy typically covered only three-quarter of the insured's liabilities towards third parties. The typical liabilities arise in respect of collision with another ship, known as "running down" (collision with a fixed object is a "harbour"), and wreck removal (a wreck may serve to block a harbour, for example). In the 19th century, ship-owners banded together in mutual underwriting clubs known as Protection and Indemnity Clubs (P&I), to insure the remaining onequarter liability amongst themselves. These Clubs are still in existence today and have become the model for other specialized and noncommercial marine and nonmarine mutuals, for example in relation to oil pollution and nuclear risks.
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Clubs work on the basis of agreeing to accept a ship-owner as a member and levying an initial "call" (premium). With the fund accumulated, reinsurance will be purchased; however, if the loss experience is unfavorable one or more "supplementary calls" may be made. Clubs also typically try to build up reserves, but this puts them at odds with their mutual status.

3.2 FEATURES OF MARINE INSURANCE 1) Comprehensive Accidental loss or damage cover and also includes theft of the boat and/or its contents and personal effects, malicious damage and transit damage, if the vessel is designed to be transported on its own trailer. 2) Third Party Only Restricted to damage or injury that you cause to a third party. 3) Extended Blue Water Yacht Racing A policy extension for Blue Water racing provided that operator and boat meet underwriting criteria (conditions apply) 4) Blue Water Cruising A policy extension for Blue Water racing provided that operator and boat meet underwriting criteria (conditions apply). 5) Commercial Use A policy extension to allow your boat to be involved in commercial activities (conditions apply). 6) Transit Risk Cover one-off transit risks for boats that are not designed to be normally transported on land e.g. large power boats and fixed keel yachts generally longer than 9.0metres. 3.3 ELEMENTS OF MARINE INSURANCE
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A. Features of General Contract A marine insurance policy must fulfill all the essentials of a valid contract i.e. offer, acceptance agreement, competent party, free consent, legal objects and lawful consideration. In marine insurance, the proposal may be offered by a ship owner or a cargo owner or a freight receiver. He is the insured. When the insurer accepts the proposal, it becomes an agreement. The insurer is known as Underwriter. B. Insurable Interest: Section 7, 8 and 9 to 16 provide for insurable interest. An insured person will have insurable interest in the subject-matter where he stands in any legal or equitable relation to the subject-matter in such a way that he may benefit by the safety or due arrival of insurable property or may be prejudiced by its loss, or by damage thereto or by the detention thereof or may incur liability in respect thereof. Since marine insurance is frequently affected before the commercial transactions to which they apply are formally completed it is not essential for the assured to have an insurable interest at the time of effecting insurance, though he should have an expectation of acquiring such an interest. If he fails to acquire insurable interest in due course, he does not become entitled to indemnification. Since the ownership and other interest of the subject matter often change from hands to hands, the requirement of the insurable interest to be present only at the time of loss makes a marine insurance policy freely assignable.

C. Utmost Good Faith:

Section 19, 20, 21 and 22 of the Marine Insurance Act 1963 explained doctrine of utmost good faith. The doctrine of caveat emptor (let the buyer beware) applies to commercial contracts, but insurance contracts are based upon the legal principle of uberrimae fides (utmost good faith). If this is not observed by either of the parties, the contract can be avoided by the other party. The duty of the utmost good faith applies also to the insurer. He may not urge the proposer to affect an insurance which he knows is not legal or has run off safely. But the duty of disclosure of material facts rests highly on the insured because he is aware of the material common in other branches of insurance are not used in the marine insurance. Ships and cargoes proposed for insurance may be thousands of miles away, and surveys on underwriters' behalf are usually impracticable. The assured, therefore, must disclose all the material information which may influence the decision of the contract. D. Doctrine of Indemnity: Under Section 3 of the Act at is provided 'A contact of marine insurance is an agreement whereby the insurer undertakes to indemnify the assured in the manner and the extent agreed upon. The contract of marine insurance is of indemnity. Under no circumstances an insured is allowed to make a profit out of a claim. In the absence of the principle of indemnity it was possible to make a profit. The insurer agrees to indemnify the assured only in the manner and only to the extent agreed upon. Marine insurance fails to provide complete indemnity due to large and varied nature of the marine voyage. The basis of indemnity is always a cash basis as underwriter cannot replace the lost ship and cargoes and the basis of indemnification is the value of the subject-matter. E. Principle of Subrogation
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Section 79 of the Act explains doctrine of subrogation. The aim of doctrine of subrogation is that the insured should not get more than the actual loss or damage. After payment of the loss, the insurer gets the light to receive compensation or any sum from the third party from whom the assured is legally liable to get the amount of compensation. At the same time the right of subrogation must be distinguished from abandonment. If property is abandoned to a marine insurer, he is entitled to whatever remains to the property irrespective of value of subrogation. F. Warranties: A warranty is that by which the assured undertakes that some particular thing shall or shall not be done, or that some conditions shall be fulfilled or whereby he affirms or negatives the existence of a particular state of facts. Warranties are the statement according to which insured person promises to do or not to do a particular thing or to fulfill or not to fulfill a certain condition. It is not merely a condition but statement of fact. Warranties are more vigorously insisted upon than the conditions because the contract comes to an end if a warranty is broken whether the warranty was material or not. In case of condition or representation the contract comes to end only when these were material or important. G. Proximate Cause: According to Section 55 (1) Marine Insurance Act,' Subject to the provisions of the Act and unless the policy otherwise provides the insurer is liable for any loss proximately caused by a peril insured against, but subject to as aforesaid he is not liable for any loss which is not proximately caused by a peril insured against.' Section 55 (2) enumerates the losses which are not payable are (i) misconduct of the assured (ii) delay although the delay be caused by a peril insured against (iii)
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ordinary wear and tear, ordinary leakage and breakage inherent vice or nature of the subject matter insured, or any loss proximately caused by rates or vermin or any injury to machinery not proximately caused by maritime perils. Thus the proximate cause is the actual cause of the loss. There must be direct and nonintervening cause. The insurer will be liable for any loss proximately caused by peril insured against. H. Assignment: A marine policy is assignable unless it contains terms expressly prohibiting assignment. It may be assigned either before or after loss. A marine policy may be assigned by endorsement thereon or on other customary manner. A marine policy is freely assignable unless assignment is express prohibited. A marine policy is not an incident of sale. So, if there is intention to assign a policy when interest passes, there must be an agreement to this effect. Sections 53 of the Marine Insurance Act, 1963 states, Where the assured has parted with or lost his interest in the subjectmatter insured and has not, before or at time of so doing, expressly or impliedly agreed to assign the policy, any subsequent assignment of the policy is inoperative. Section 17 of the Act states, "Where the asserted assigns or otherwise parts with his interest in the subject-matter insured, he does not thereby transfer to the assignee his rights under the contracts of insurance.

3.4 TYPES OF MARINE INSURANCE

 Cargo Insurance: Cargo insurance caters specifically to the cargo of the ship and also pertains to the belongings of a ships voyagers. Marine cargo Insurance is the insurance of property as it moves from place to place. The word marine conjures up the sea and foremost in the minds of the writers of the Marine Insurance Act 1906 (MIA) was indeed sea transits. While the Act in its opening sections refers to marine losses and to the marine adventure and to maritime perils, marine insurance departments insure property conveyed by aircraft and road and rail vehicles as well. Many transits, particularly international ones require two or more types of transport and the Act makes provision for them. Hull Insurance: Hull insurance mainly caters to the torso and hull of the vessel along with all the articles and pieces of furniture in the ship. This type of marine insurance is mainly taken out by the owner of the ship in order to avoid any loss to the ship in case of any mishaps occurring. Liability Insurance: Liability insurance is that type of marine insurance where compensation is sought to be provided to any liability occurring on account of a ship crashing or colliding and on account of any other induced attacks. Freight Insurance: Freight insurance offers and provides protection to merchant vessels corporations which stand a chance of losing money in the form of freight in case the cargo is lost due to the ship meeting with an accident. This type of marine insurance solves the problem of companies losing money because of a few unprecedented events and accidents occurring. 3.5 TYPES OF MARINE INSURANCE POLICIES
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1. Time policy A time policy is taken for definite period of time, usually not exceeding 12 months say from January 1, 1981 to December 31, 1981. This policy is most suitable for hull insurance. 2. Voyage policy Where the subject matter is insured for a specific voyage, say from Gateway of India to Port in Srilanka it is named as voyage policy. 3. Mixed policy This policy is the combination of time and voyage policy. It, therefore, covers the risks for both particular voyage and for a stated period of time. 4. Floating policy Floating policy is taken for a relatively large sum by the regular suppliers of goods. It covers several shipments which are declared afterwards along with other particulars. This policy is most situated to exporter in order to avoid trouble of taking out a separate policy for every shipment. 5. Valued policy Under its terms the agreed value of the subject matter of insurance is mentioned in the policy itself. In case of cargo this value means the cost of goods plus freight and shipping charges plus 10% to 15% margin for anticipated profit. The said value may be more than the actual value of goods. 6. Unvalued policy (Open Policy)
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Where the value of the subject matter of insurance is not declared but left to be ascertained and proved later it is called unvalued policy. 7. Builder's risk policy This policy is issued for more than one year. This covers the risk of damage to vessels from the time its construction commences until its trail is completed. 8. Blanket policy Under the condition of the blanket policy the maximum limit of the required amount of protection is estimated which is purchased in lump sum. The amount of premium is usually paid in advance. This policy describes the nature of goods insured, specific route, ports and places of the voyages and covers all the risk accordingly. 9. Port risk policy This policy covers all the risk of a vessel while it is standing at a port for particular period of time. 10. Wager policy Where the assured has no insurable interest in the subject matter of insurance that is known as wager policy. As this policy has no legal effect so it cannot be taken to a court of law. If underwrite refuses to accept the claim the policy holder cannot take any legal action against him. It is, therefore, also called as gambling policy.

11. Special hazards policy

This policy covers special risks incident to piracy and war. It provides protection to insured under agreement against seizure, capture, detention and other war risks. 12. Composite policy This type of policy is purchased from more than one under writers. If there is no any motive of fraud then insured will be indemnified by each under writer separately in case of loss. 13. Block policy This policy is particularly purchased to gold diggers. It covers all the risks of damage to gold from the time of its recovery to its distinction. This type of policy has been introduced in Africa and is very popular in the mine fields of gold.

3.6 IMPORTANT CLAUSES IN MARINE POLICY

Lot of Not Lot-This clause protects the insured, which in good faith insures goods which are on a ship which has left a foreign port, in case they were destroyed unknown to him, before he affected the policy. In this case both the injured as well as the insurer ought not to have been aware of the loss of the goods or the steamer at the time of the insurance. If the insured knew of the loss and did not inform the insurer at the time of effecting insurance the policy would be void.

ii.

Name of the Ship and Master- Here is given the name of the ship and the master for the voyage which is insured.
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iii.

Valuation Clause-This clause states the actual value of the goods as agreed upon between the underwriter and the insured in the case of a valued policy, and in the ca se of an open policy a bland is left after the words, 'and shall be valued at..'

iv.

The Parties-All persons competent to contract may be parties to policy of insurance. A policy may be underwritten or undertaken either by an insurance company or an individual underwriter as is the case with Lloyd's in England. The expression for and in the name of all and every other person or persons, etc.' protects all persons who has insurable interest at the time of effecting the policy or who acquired insurable interest during the continuation of the risk.

v.

Description of the Voyage or Duration of the Risk- This clause begins with the works 'at and from' and in the blank left in the policy is inserted the description of the voyage intended to be insured. The risk begins from the place at which the steamer is at the time of insurance and ends when she arrives at the port of destination.

vi.

Sea Perils Insured Against, or the Perils of the Sea- These perils include in detail all the perils against which the insured is protected. This clause in Lloyd's embraces almost all the sea perils including 'periods of the seas, men-of-war, fire, pirates, rovers, thieves, jettisons, arrests restraints and detention of all kings, princes and people, and mariners and of all other perils, losses, and misfortunes that have or shall come to the hurt, detriment, or damage of the sail goods or merchandise and the ship.'

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vii.

Receipt of Premium and the Rate Charge- The receipt of premium and the rate charged are stated in this clause. Premium is the consideration paid by the insured to the underwriter for undertaking to indemnify him against the loss as per the terms of the policy. The form of Lloyd's policy clearly uses the words, 'confessing ourselves paid the consideration due...', as if the premium had already been paid to the underwriter, at the time the policy was affected. In practice, however, the premium in London on Lloyd's is not paid by the broker at the time of affecting the policy. The practice there is to pass the amount in account between the insurance broker and the underwriter.

viii.

Sea Perils Insured Against, or the Perils of the Sea- These perils include in detail all the perils against which the insured is protected. This clause in Llyod's embraces almost all the sea perils including 'perils of the seas, menof-war, fire, pirates, rovers, thieves, jettisons, arrests, restraints and detention of all kings, princes and people, barratry of masters and mariners and of all other perils, losses, and misfortunes that have or shall come to the hurt, detriment, or damage of the said goods or merchandise and the ship.'

ix.

Memorandum-The commodities which are the subject matter of marine insurance comprise various articles which are liable to undergo deterioration or damage to a greater or lesser extent according to their peculiar nature. Some of these commodities may even perish or be damaged through detention or delay. To avoid, therefore, claims arising through the inherent vice in the nature of such commodities, almost every policy of insurance includes a clause or memorandum; in the case of the Lloyd's policy it is called the F.P.A. clause.
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Under the F.P.A. clause the underwriter is liable for total loss but is not liable for particular average or partial loss. Partial loss is agreed to be paid if it exceeds three per cent in certain cases, and five per cent in others.
x.

Waiver Clause-This is in fact continuation of the 'sue and labour' clause because it lays down that 'no acts of the assurer or assured in recovering, saving or preserving the property insured, shall be considered as a waiver or acceptance of abandonment. 'This clause is nowadays found in almost all public policies of Lloyds's.

xi.

Sue and Labour Clause-Under this clause it is specifically provided that it shall be lawful to the assured, his factors, agents and assigns to do all in their power to defend the property insured in case of damage or loss; and in return in the underwriter agrees that the insured's rights to his insurance claim are not in any way prejudiced; and that all the expense thought lawful in such prejudiced; and that all the expenses though lawful in such attempt shall, save costs against the damage insured, be made good by the underwriter.

xii.

Implies Warranties Besides the actual conditions the following are implied by law:a. Seaworthiness-i.e. at the time of insurance the ship is en every respect fit for the voyage. b. Legality of Voyage-i.e. it is for a legal purpose and is not, for example, a smuggling adventure. c. Non-deviation-i.e. where a voyage is between two specified ports that the ship will take the usual route and not deviate from it except through unavoidable necessity.
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xiii.

Causa Proxima The literal meaning of this Latin expression is "Proximate Cause.' This arises when a property is insured at sea and more than one cause operates to bring about loss, in which case the proximate cause ought to be considered. Thus, in a case where the cargo was damaged by sea- water which trickled from a pipe gnawed by rats, it was held that the proximate cause was the sea-water, and the insured was entitled to damages, the rat's beings remote cause.

xiv.

Bottomry Bond When the master of a ship is in urgent need of money which he cannot raise on the owner's credit, or is unable to communicate with the owner, he has the power to give a bond known as the "bottomry bond,' by which he pledges the ship as a security to the person advancing money. The peculiarity of this bond is that the capital and interest on the loan is payable only if the ship reaches its destination if therefore, after this bond is given, the master proceeds its destination. If, therefore, after this bond is given, the master proceeds with the voyage and has, at women other port, to raise further money for urgent repairs, for which he gives a second bottomry bond to some other person, this second part acquires a prior right over that of the lender on the first bond.

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3.7 BENEFITS OF MARINE INSURANCE The cover, automatic and optional extensions bring many benefits to your extensive insurance cover options. Cover includes:

Sudden accidental physical loss or damage. Agreed value single sum insured on the vessel which includes, where applicable, spars, sails, machinery, tender, outboards, trailer, equipment and other accessories that would normally be sold with the craft.

Provision to insure fishing gear kept permanently aboard vessels on Moored or Berthed craft policies.

Navigation limits up to 200 nautical miles from North and South Islands of New Zealand including transportation and storage on land.

Automatic extensions include:

Emergency towing costs following a breakdown up to $2,000 per year. Crew rescue costs up to $10,000. Reimbursement of temporary accommodation costs up to $1,000 following an accident to your vessel.

Personal effects, your own or guests whilst aboard your vessel and not otherwise insured. For moored launches and yachts up to $1,000 for fishing gear and $5,000 in total and for trailer craft $1,000.

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Reimbursement of costs up to $1,000 for replenishing, refilling or replacing fire extinguishers and/or safety flares used during an incident giving rise to an admitted claim.

Reimbursement of costs, up to 25% of the sum insured, incurred in preventing or attempting to prevent loss or damage.

Medical expenses up to $2,000 incurred as a result of an accident to any person while in, upon boarding or leaving your vessel.

Items purchased for the vessel during any one period of insurance automatically covered up to $25,000 in respect of moored vessels, and $5000 for trailer craft.

Lump sum payment of $10,000 in total for the accidental death of the insured/s as a result of bodily injury whilst aboard the vessel.

Legal liability arising from the ownership or use of the vessel $5,000,000. Punitive or exemplary damages $250,000. General damages for mental injury $250,000. With our prior approval legal costs up to $10,000 should you or your vessel be involved or implicated in a maritime accident which is the subject of a MSA, TAIC or Coroner's inquiry.

Optional extensions include:

Full racing cover for yachts. Partnership deaths by accident cover-specifically for syndicates. Blue water off shore facility.
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Chapter IV NEW INDIA ASSURANCE COMPANY LIMITED

4.0 The New India Assurance Co. Ltd., based in Mumbai, is one of the five public sector insurance companies in India. It is the "largest general insurance company of India on the basis of gross premium collection inclusive of foreign operations". It was founded by Dorab Tata in 1919, and nationalized in 1973.
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Previously it was a subsidiary of the General Insurance Corporation of India (GIC). But when GIC became a reinsurance company as per the IRDA Act 1999, its four primary insurance subsidiaries New India Assurance, United India Insurance, Oriental Insurance and National Insurance got autonomy. New India Assurance operates both in India and foreign countries. In the recent past it has succeeded in forging tie-ups with some of the leading public sector banks in India such as State Bank of India, Central Bank of India, Corporation Bank and United Western Bank to increase its distribution network. New India Assurance is a Government of India undertaking. New India Assurance became nationalized in 1973. The New India Assurance Company Limited is one of the leading global insurance groups and has offices and branches throughout India and in many countries abroad. New India Assurance has established itself in the Indian as well as global insurance industry and has gained significant recognition owing to numerous achievements:

Largest Non-Life insurer in Afro-Asia excluding Japan First Indian non-life company to cross Rs. 8225.51 crores Gross Premium Over-seas presence in countries like Japan, U.K, Middle East, Fiji and Australia

Largest number of offices in India and Abroad Trained and technically qualified staff 1085 fully computerized offices across India.

"A-" (Excellent) rating by A. M. Best & Co (Europe), first domestic company to be rated by an International Rating Agency.

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First company to set up an Aviation Insurance Department in 1946. First company to handle the Hull Insurance requirements of the Indian Shipping Fleet.

First company to establish its own Training School. First company to introduce the concept of 'Model Office Training'. First company to create department in Engineering insurance. Pioneer in Satellite insurance.

4.1 OFFICES The company with its corporate office in Mumbai has about 28 regional offices, 397 divisional offices, 588 branches, 27 direct agent branches and 23 extension counters in the year 2011-2012. The number of regional offices of the company in the year 2011 stood at 28, with numerous other offices down the hierarchy of divisional offices, branch offices, direct agents branches, micro offices. Centralized claim processing offices called claims hubs are operated from 29 locations. Its overseas offices for the year 2011-2012 consisted of 19 branches, seven agencies, four associate companies and three subsidiary companies spread over 23 countries. 4.2 THE PIONEERS

First company to set up an Aviation Insurance Department in 1946. First company to handle the Hull Insurance requirements of the Indian Shipping Fleet.
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First company to establish its own Training School. First company to introduce the concept of 'Model Office Training'. First company to create department in Engineering insurance. Pioneer in Satellite insurance.

4.3 THE NEW INDIA ASSURANCE GENERAL INSURANCE PRODUCTS Health Plans Hospitalization burn a hole in our pocket and alter our quality of life by imposing financial restrictions New India Assurance health plans guarantee peace of mind for the insured against financial perils caused due to sudden hospitalization:

Pravasi Bharatiya Bima Yojana Policy Personal Accident Policy Rasta Apatti Kavach (Road Safety Insurance)

Mediclaim Policy

Janata Mediclaim policy: The New India health insurance policy covers pre and post hospitalization expenses but in the case when hospitalization is for more than 24 hours. The policy also provides medical expenses towards day care treatments and ambulance charges are also met by the policy. Preexisting diseases are covered after four continuous and claim free renewals with the company.

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Family Floater Mediclaim policy: This is the policy specially designed to cover family under single premium. It covers individuals spouse and children under the same policy. The basic premium charged is per the highest aged member and loadings are charged for covering spouse and children. This policy provides pre and post hospitalization expenses.

Senior citizens Mediclaim policy: This policy is meant for senior citizens above the age of 60 years till 80 years. Proposers must undergo a prescribed pre-acceptance health check at their own cost to identify pre-existing diseases. The health check is waived if the proposer is already having Mediclaim insurance in continuity with our Company.

Car Insurance Plans New India Assurance plans provide you with a comprehensive motor policy that lets you take care of yourself rather than a car i case of an accident. The motor insurance plan provided by the company covers scooters, motorcycles, private cars and all types of commercial vehicles. The policy is available under two variantsliability only policy and package policy. Liability only policy covers third party liability for bodily injury, death and property damage, personal accident cover for driver is also included under the liability variant while package policy covers loss or damage to the vehicle plus everything covered under liability policy. The package policy also covers loss arising from fire, explosion, earthquake, flood, riot, strike and any damage from terrorist activity. Various add on covers like damage or loss to electrical and other accessories, legal liability to employees can be added by paying extra premium.
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Motor Policy

Travel Insurance Plan New India Assurance Policies become a great companion for you on your holidays, business trips or visits and help in safeguarding the dilemma of lost baggage on the way.

Overseas Mediclaim policy: The New India Assurance Overseas travel insurance is specially meant for travelers travelling frequently outside India. The main feature of this plan is that the premium is paid in local currency while claims are settled foreign currency. It covers medical expenses incurred by insured outside India as a direct result of the bodily injury caused or sickness or disease contracted during the travel. Additional benefits like loss of baggage, personal accident, loss of passport and personal liability are extended with the payment of extra premium.

Suhana Safar policy: The New India Assurance Suhana Safar policy is designed particularly for domestic travelers. The policy covers any mode of transport like rail, road, air, water including own vehicle. This policy can be availed for a shorter period for as short as 60 days. The policy covers the risk of personal accident, loss or damage to the baggage of a family consisting of spouse and dependent children. The cover operates from

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declared place of departure and terminates on schedule date of return or on actual return, whichever may happen earlier.

Marine Insurance Plans New India Assurance provides Marine Insurance Policy as well as the shipping Cargo policy which helps to recover the damage to the ships and the goods during the travel from origin to the destination. This policy covers goods, freight and other interests against loss or damage to goods whilst being transported by rail, road, sea and/or air.

Different policies are available depending on the type of coverage required ranging from an ALL RISK cover to a restricted FIRE RISK ONLY cover. This policy is freely assignable and is basically an agreed value policy.

Home Insurance Plans New India Assurance Policies help to safeguard your home and give you comprehensive coverage against many perils.

The New India Assurance Householders policy : This policy is a package policy specially designed to meet the insurance requirements of a house holder. The coverage of this policy is very large. It covers for any damage
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due to fire, explosion, lightening and natural calamities like floods, earthquakes, landslides, hurricane, tornado, storm etc. This policy covers whole building as well as its contents. This policy covers the contents of the home from loss suffered from burglary and house-breaking. Jewelry, glass and domestic appliances are covered from any loss or damage from any kind of accident. Electrical appliances damage is also covered under this policy. The New India Assurance house holders policy covers the loss or damage of pedal cycles due to fire and allied perils, burglary, housebreaking, accidental external means and third party personal injury or third party property damage. It also covers insureds legal liability for bodily injury or loss of or damage to property of third party limited to amount specified in the schedule and workmen's compensation liability to domestic servants engaged in insured's premises. It is advisable to compare all New India Assurance General insurance plans from other General insurance companies in India to choose the best insurance plan that suits you the most. Personal Accident Plan The New India Assurance personal accident plans are one of the comprehensive plans available in the market. One can make online comparison between The New India Assurance personal accident premium and The New India Assurance personal accident quotes to understand the policy.

Personal Accident policy: This is a broader coverage plan which compensates an insured or its nominees in the event of death and any kind of permanent or temporary disability. The policy provides compensation in case of any bodily injury or death to the insured, directly and solely as a
46

result of accident by external, visible and violent means. The policy does not compensate in the case of death due to any pre-existing illnesses. Under this policy, family floater and group insurance policies are also available. There is a special student plan under this policy as well.

Rasta Apatti Kavach (Road safety insurance): This insurance policy has been designed to cater to the specific need of an individual who meets with an accident with a motor vehicle on road and sustains injuries which requires hospitalization for treatment. The policy also has provision for compensation for death and permanent disability. The policy has two sections. One of which provides compensation payment in case of personal accident and other is the compensation by providing medical expenses in case of any hospitalization.

4.4 FINANCIAL RATING For the sixth consecutive year, the Company has been rated as "A-" (Excellent) by M/s. A.M. Best Europe Ltd. The rating reflects Company's excellent risk adjusted capitalization, prospective improvement in underwriting performance and its leading business profile in the direct insurance market in India. A partially offsetting factor is the Company's reliance on investment income which counter balances underwriting losses. But the outlook is stable. A.M. Best believes the Company's risk adjusted capitalization is excellent and anticipates that it will remain sufficient to absorb the likely growth in the net premium. Further it also expects that there will be a reduction in the combined ratio in the years to come.

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The Company is likely to maintain its leading business position as the largest direct insurer in India, despite increased competition from private players.

4.5 THE NEW INDIA ASSURANCE PERFORMANCE New India Assurance Company is the largest non-life insurer in India. The financial strength of the Company is reflected from the following figures:-

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Statistical data on performance of NEW INDIA ASSURANCE COMPANY LTD (1998-2012)

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4.6 NEW INDIA ASSURANCE MARINE CARGO POLICY

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This policy covers goods, freight and other interests against loss or damage to goods whilst being transported by rail, road, sea and/or air. Highlights

This policy covers goods, freight and other interests against loss or damage to goods whilst being transported by rail, road, sea and/or air. Different policies are available depending on the type of coverage required ranging from an ALL RISK cover to a restricted FIRE RISK ONLY cover.

This policy is freely assignable and is basically an agreed value policy.

Premium & Claims The sum insured or value of the policy would depend upon the type of contract. Usually, in addition to the contract value 10/15% is added to take care of incidental cost. The following steps should be taken in event of a loss or damage to goods insured: 1. Take immediate steps to minimize loss. 2. Inform nearest office of the insurance company or claim settling agent mentioned on the policy. 3. In case of damage to goods whilst on ship or port, arrange for joint ship survey or port survey. 4. Lodge monetary claim with carrier within stipulated time period. 5. Submit duly assigned insurance policy/certificate along with the original invoice and other documents required to substantiate the claim such as :
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1. Bill of Lading / AWB/GR 2. Packing list 3. Copies of correspondence exchanged with carriers. 4. Copy of notice served on carriers along with acknowledgment/receipt. 5. Shortage/Damage Certificate issued by carriers. 6. Survey fees are to be paid to the surveyor appointed by the insurance company. These fees will be reimbursed along with the claim if the claim is otherwise admissible.

4.7 NEW INDIA ASSURANCE MARINE HULL POLICY It covers any loss or damage to ships, tankers, bulk carriers, smaller vessels, fishing boats and sailing vessels. The Ship-owners, charterers, Shipbuilders, bankers, financiers of Ships or vessels who have Insurable interest can take the policy. Policy Covers

All types of Oceangoing vessels All type of Coastal/Inland vessels Yard and pleasure Crafts Port Crafts Shipbuilding- construction of vessel
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Ship Repairers' Liabilities Charterers Liabilities Breaches of warranties / voyage cover Freight- at -Risks insurance for voyages Dredgers Fishing vessels / Trawlers Sailing Vessels Jetties (with or without cranes), fixed pontoons/Pontoons Jetties, wharves etc.

Ship breaking

4.7.1 PERILS / RISKS (A) The policy covers perils of the seas, rivers, lakes or other navigable waters loss/damage to the property insured caused by:

Fire, explosion Stranding, sinking etc. Overturning, derailment ( of land conveyance ) Violent theft by persons outside the vessel. Collision General average sacrifice, sacrifice, salvage charges
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Jettisons Piracy Breakdown of or accident to nuclear installations or reactors Contact with aircraft or similar objects, or objects falling there from, land conveyance, dock or harbour equipment or installation.

Earthquake volcanic eruption or lightning. Crew Negligence.

Exclusions The policy does not cover loss/ damage due to:

Deliberate damage/destruction of the vessel by wrongful act of any person Use of any weapon of war employing atomic / nuclear fission and or fusion. Radioactive Contamination, Chemical, Biochemical, Biological,

Electromagnetic Weapons.

Insolvency or financial default of the vessel owner /operators /charterers War / civil war, Strike, Riot or Civil Commotion Any terrorist or person/s acting with political motive

(B) COMPREHENSIVE PORT PACKAGE POLICIES: Cover can be purchased by:

Port Authorities
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Port / Terminal operators Private Jetty Owners

Scope of Comprehensive covers:

Physical Damage Third Party Liability Business Interruption Terrorism Wreck Removal - H & M Cover for Vessels

Exclusions:

Confiscation, requisition, detention Blocking of sewers, drains Wear & Tear, deterioration Error in design, workmanship Mechanical / Electrical Breakdown

(C) Oil & Energy Risk Insurance Policies:

Cover can be purchased by - Oil and Energy Industries. Scope of Comprehensive covers 55

o o o

Offshore / Onshore constructions / Erections ( Builders Risks ) Production / Operation Cover - Well head platform/ process platform. Exploratory Drilling (Offshore - Jack Up Rigs, Drilling Rigs, Semi Submersibles etc. Onshore- Fixed Land rigs, Mobile Land Rigs, Work-over Land rigs)

o o o

Seismic Survey Single Buoy Mooring ( SBM ) Under water pipeline / Cable Insurance

Claim Intimation and Steps to be taken by Owners: In the event of casualty likely to give rise to a claim

Immediate notice to policy issuing office. Giving brief details as to name of vessel, place of occurrence, date & time of casualty, circumstances leading to incident.

Seek appointment of surveyor to inspect and assess loss. In case of theft please notify police. In case of fire assistance of fire brigade to extinguish fire. Appointment of adjuster in case of Oceangoing Vessels where necessary. All steps to minimize loss as prudent uninsured.

Documents Essential:
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Certified copy of note of protest by master Marine casualty form issued by M.M.D. Insured's report on occurrence. Survey Report Original Repair Bill, cash memo, Invoices Weather Report by Meteorological Dept. Affidavits filed by rescue vessels Certificate of survey for inland vessels Registry certificate Free board certificate Load line certificate (where applicable ) Status / copies of Mandatory certificates Notarized statements of master and chief engineer of the vessel. Log Book extracts (Engine & Deck ) Crew list with details of competency certificates. Copy of Claim bill with supporting documents.

Chapter V FINDINGS & SUGGESTIONS

5.0 The complete findings and required suggestions are finally given in this chapter for the purpose of improving the performance of New India Assurance Company Limited in providing Marine insurance policies & also framing new policies in the future. 5.1 FINDINGS 1. Introduction chapter explained the overview of the project report; it contains the objectives, hypothesis & the limitations of the study. It also has the reviews given by certain authors regarding the general insurance sector and the marine insurance. 2. The second chapter contains about the introduction to insurance, its principles, and various types of insurance. 3. The third chapter is the analysis chapter which contains detailed information about marine cargo insurance, the marine insurance products, its different policies & important clauses in marine insurance. 4. The fourth chapter is also an analysis chapter which states about the New India Assurance Company Ltd, the products offered by the company, & different types of marine insurance and services offered by the company and the premiums, claims and eligibility regarding the marine insurance policies. 5. The fifth chapter is the final chapter which includes required findings & suggestions for the project.

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6. During the survey it was observed that major source of information for consumer are television and newspaper and least preference are given to magazines, agents and friends. 7. Attractive schemes and brand image are the most important factor that influences the buying behavior of the consumers.

5.2 SUGGESTIONS On the basis of the collected data and the analysis, some suggestions can be made to the New India Assurance Co. Ltd which will be helpful to them in improving their services operational and financial performance. These suggestions have been discussed as follows:

1. Even though most of the policy holders are satisfied with policies, plans they have but some new attractive insurance plans should be introduce to bind them not to switch over to other companies insurance plans.
2. The company should find out the no. of people who are not having any of

the Marine insurance plans through an intensive market research and motivate them to get insured.
3. Leveraging technology to service customers quickly, efficiently and

conveniently.

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4. Developing

and implementing superior risk management and

investment strategies to offer sustainable and stable returns to our policyholders. 5. New India Assurance Co. Ltd should target each and every class of the society while providing the products.
6.

Company should provide full information to the customers before targeting so they can take interest in the Marine Insurance policy which they have opted for.

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CONCLUSION
After completing the project it is concluded that New India assurance Co. Ltd has develop its various plans and policies, flexible in nature, according to the requirements of its targeted market or customers and is thus beneficial to its customers in various ways. The most important benefit it provides to its customers is that it is a government owned company. This lead to increase in the satisfaction level of its customer that is why New India assurance Co. Ltd has28 regional offices, 397 divisional offices, 588 branches, 27 direct agent branches and 23 extension counters in the year 2011-2012. Therefore it is not only beneficial but better than other insurance companies not only regarding its product but also its services. From the discussion it is evident that general insurance industry expanded tremendously from 1973 onwards in terms of number of offices, number of agents, new business policies, premium income etc. Further, many new products (Marine insurance, motor insurance, Mediclaim policy, etc.) and the insured were provided by the insurers to suit the requirements of various customers. The marine insurance policy provided by the New India Assurance Company Ltd act as a tool for improving the performance of the company for providing the marine insurance policy to its customers satisfying their most of the needs.

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BIBLIOGRAPHY

BOOKS
General Insurance Year Book, Dr.Rakesh Agarwal, July 2011 Elements of Banking & Insurance, 2006, Jyotsana Sethi Marine Insurance: its Principles & Practices volume 1, William Winter, 2005 Innovations in Banking & insurance, Romeo S. Mascarenhas

WEBSITES www.newindia.co.in www.wikipedia.org www.insuremarine.com www.myinsuranceclub.com

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www.allinsuranceinfo.com

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