Insurance Law Monthly

Under the Marine Insurance Act 1906, where a vessel has been damaged the amount recoverable by the assured depends upon whether there is a total loss (in which case the assured receives the sum insured) or a partial loss (in which case the assured recovers reasonable repair costs). Non-marine law draws a sharp distinction between damage that can be repaired (partial loss) and damage that cannot be repaired (total loss), whereas marine law alone recognises an intermediate possibility of loss that is repairable but not worth repairing (constructive total loss).