Marine Hull Insurance Policy

Marine Hull & Machinery insurance Policy covers physical loss or damage for the hull (or shell) of a ship and also its propulsion machinery, fittings & Freight. It covers all kinds of vessels going into the ocean, including ships, tankers, bulk carriers, dredgers, trawlers, fishing boats, pontoons, yachts, cruises and other pleasure boats, jetties and wharfs. It is an Air freight.

Scope of Cover

Marine hull insurance focuses on the ship-owner’s interest owned by individuals& legal entities, but is limited to the Hull & Machinery part, which insures everything owned by the ship’s owner, including the body of the ship, machinery, tackle, boats, fittings, equipment, bunkers, engine stores, stores and provisions for the officers and crew.

Hull and Machinery insurance usually covers loss or damage caused by major named perils such as collision, grounding, fire and explosion, earthquakes (and the tidal waves that might follow them)Burglary/theft as well as general perils of the sea, lakes or rivers - which must be shown to be extraordinary in nature.

It also covers collision liability, general Average and salvage, loss of freight, loss of disbursements, and damage to the vessel during maintenance activity. Most hull and machinery policies will also cover sue and labor expenses, which are those costs incurred by an insured when trying to solve a problem for himself. Coverage is worldwide for ocean-going vessels.

Time Clauses under the marine hull insurance policy are:

Institute Time Clauses (Hull): This covers hazards of seas, rivers, lakes and other navigable waters; loss or damage to property from fire or explosion, stranding or sinking, capsizing or derailment, violent robbery by external elements, jettison, Piracy, earthquake, volcanic eruption or lightning; damage due to collision with other ships, aircrafts or other vehicles on land or sea; general Average, sacrifice and salvage charges; loss due to articles falling off aircrafts or other vessels; damage while installation or equipping at dock or harbour; loss due to negligence of the crew; pollution hazard; wages, maintenance and agency commission; 3/4th of collision liability; legal and labour expenses; and constructive total loss coverage.

Institute Time Clauses (FPA): The free of particular Average (FPA) insurance coverage clause is similar to the Hull coverage, but excludes machinery damages of any kind. The FPA coverage is generally given when the ship being insured is more than 15 years old, because older vehicles are bound to suffer more damage, especially on the machinery front.

Institute Time Clauses (Total Loss Only): This clause covers only the total ascertained loss based on actual, compromised or constructive losses. Such a policy is offered mainly to very old and large vessels, and it is available at a relatively lower cost.

Institute Voyage Clauses are applied to a marine hull insurance policy to provide protection against risks during a voyage from one port or place to another, or a round trip.

Institute time clause Port risk: These clauses are used for insurance of vessels operating within the port-hence the name Port Risk Clauses.

Builders’ Risks Clauses: The Builders’ Risk Insurance becomes effective when a proposer wishes to insure vessels built and whilst under construction. The cover becomes effective from the time of the laying of the keel and terminates upon construction and finalization of trial runs. Like in other insurances, the Builders’ Risks Insurance Cover affords comprehensive coverage during all stages of constructions and also covers equipment at location.

Ship Repairs’ Liability: Ship Repairs’ Liability is meant for those engaged in ship repair work and the Insurer covers only the liability of the repairers towards the ship owner in respect of any loss/damage, which may occur to vessel whilst in the custody of the ship repairers, at his ship repairing yard.

Add on covers

War and Strikes, Riots and Civil Commotion Cover


Passenger Liability Cover

Crew Liability Cover


The Premium rate of Marine Hull insurance generally depends on various factors such as type and age of vessel, valuation or cost of the insured vessel, tonnage and traditional limits, size of deductibles, ownership terms of the vessel, the regulatory regime the ship is operating under known as her Flag


The standard Exclusions in a hull and machinery policy are

War- which also includes damage caused by bumping into a disused mine or torpedo floating around in the sea

Strikes- which includes not only damage caused by strikes and strikers but also terrorist type risks

Malicious acts -loss or damage caused by people acting maliciously or from a political motive and either detonating explosives or using weapons of war.

Wreck removal,

1/4th of collision damage

Nuclear - loss or damage arising from a weapon of war employing atomic or nuclear reactions. Attack or damage from biological, biochemical, chemical or electromagnetic weapons