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What are the Different Types of Marine Losses

Posted on 08 Jul 2021
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What are the Different Types of Marine Losses?

Marine losses come in different forms, and it’s difficult to quantify them. Though a marine insurance policy helps you overcome the losses financially, it’s prudent to know about the different types of losses so that you can know how to go ahead with claim settlement.

This blog will focus on the different types of marine losses so that you would get a complete understanding of the total retrieval amount. Let’s get started.

Types of Marine Losses

Two Broad Categories of Marine Losses

Broadly, there are two categories of marine losses:

  • Total Loss:When insured goods have lost 100% (or nearly 100%) of their value, the loss is categorised as a total loss.

  • Partial Loss: When a part of the insured goods is damaged, then the loss is classified as partial loss.

  • Cost of surgery and recovery equipment

Further Subcategories

There are further subcategories of total and partial losses. A total loss can be further categorised as:

  • Actual Loss:Actual loss happens when cargo is destroyed to such an extent that there’s no possibility of recovering goods. To put it otherwise, in an actual total loss, even if goods are salvaged, it’s of no use.

  • Constructive Loss:In marine insurance, a damage is referred to as constructive loss when the cargo is damaged to such an extent that its cost of repairing and reconditioning is more than its total value.

  • Cost of surgery and recovery equipment

Sub categories of partial losses include:

  • Particular Partial Loss:If goods incur partial damage, then it’s deemed as a particular partial loss. Particular partial loss is further sub-divided into:

    • Total Loss of a Good’s’ Part: When a partial consignment is lost, this method is applied to compute the actual loss amount.
    • Arrival of Damaged Goods:If goods come in damaged condition at the destination, then attempts are made to arrive at the said percentage of the depreciated value of goods.
  • General Average Loss:If goods are damaged deliberately to avoid some danger, then it’s classified as a general average loss. For example, if you are supplying chemicals and if some of them had to be thrown away due to leakage running the risk of ship contamination, then this falls under the category of a general average loss.

In Conclusion

Be it marine cargo insurance, inland Marine Insurance or any other type of marine insurance policy, the insurance company would settle the losses and compensate for the same based on the category of the losses incurred.

  • Marine Transit Insurance (Inland) Policy
  • Product Code: 2005
  • Product UIN: IRDAN115CP0007201920

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This contains only an indication of the cover offered. For complete details on risk factors, terms, conditions, coverages and exclusions, please read the sales brochure carefully before concluding a sale.ICICI trade logo displayed above belongs to ICICI Bank and is used by ICICI Lombard GIC Ltd. under license and Lombard logo belongs to ICICI Lombard GIC Ltd. ICICI Lombard General Insurance Company Limited, ICICI Lombard House, 414, Veer Savarkar Marg, Prabhadevi, Mumbai – 400025. . IRDA Reg.No.115. Toll Free 1800 2666. Fax No – 022 61961323. CIN (L67200MH2000PLC129408). (Marine Single Transit Insurance, 2005 , IRDAN115CP0007201920)