Types of Marine Loss
A loss arising in a marine adventure due to perils of the sea is a marine loss.Marine loss may be classified into two categories:
1) Total loss
A total loss implies that the subject matter insured is fully destroyed and istotally lost to its owner. It can be Actual total loss or Constructive total loss.
In actual total loss subject matter is completely destroyed or so damaged thatit ceases to be a thing of the kind insured. e.g. sinking of ship, complete destruction of cargo by fire, etc.In case of constructive total loss the ship or cargo insured is not completely destroyed but is so badly damaged that the cost of repair or recovery would be greater than the value of the property saved. e.g. a ship dashed against therock and is stranded in a badly damaged position. If the expenses of bringing it back and repairing it would be more than the actual value of the damaged ship, it is abandoned.
2) Partial loss
A partial loss occurs when the subject matter is partially destroyed or damaged. Partial loss can be
general average or particular average
.General average refers to the sacrifice made during extreme circumstances for the safety of the ship and the cargo. This loss has to be borne by all theparties who have an interest in the marine adventure. e.g. A loss caused by throwing overboard of goods is a general average and must be shared by various parties.
Particular average may be defined as a loss arising from damage accidentally caused by the perils insured against. Such a loss is borne by the underwriter who insured the object damaged. e.g. If a ship is damaged due to bad weather the loss incurred is a particular average loss.
on-deck-clause
