Marine Insurance: Law and Practice
AVERSION AND MINIMISATION OF LOSS1
As a general proposition, and recognising that the purpose of a marine insurance contract is to function as a contract of indemnity, it is in the interests of the assured and of the insurer to avert and/or to minimise loss. Commonly, measures to do so are or must be taken as a matter of course, and the assured bears the responsibility for this. Thus, owners of cattle insured against, inter alia, mortality cannot recover for death caused through breach of their implied obligation that the cattle are sent to sea with a supply of fodder reasonably sufficient for a voyage of the duration to be expected.1 The assured’s implied obligations to ensure that the subject matter will be safe during the currency of the policy, so far as they apply,2 are a manifestation of the general principle of fortuity and should, therefore, be seen equally to require the assured on ship and/or freight to ensure that the voyage is performed in the ordinary way, or in any other way contemplated by the contract, and to bear the expenses of doing so.3 Where this does not occur, the insurer may be able to escape liability, for example, because there has been non-disclosure of a material fact,4 a breach of implied warranty or non-compliance with a warranty expressly included in the contract to specify and/or minimise the risk.5 Finally, it may be noted that an expense incurred as a direct consequence of an insured loss that has already occurred (as opposed to one incurred in order to avert a future loss), for example the cost of unloading coal that has overheated, is recoverable as a loss caused by an insured peril.6
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