| Term | Definition |
|---|
| In the ocean marine insurance, which of the following is/are considered the most important implied warranties? A. Seaworthiness; B. Condition of the cargo; C. Legality; D. All of the above | A. All are very important warranties. Probably the most fundamental would be the seaworthiness of the vessel. |
| In the ocean marine field, the term "average" means: A. The ACV of the ship; B. The annual premium for the insurance policy; C. Loss or damage; D. That coverage is written on a named peril basis | C. The term "average" in ocean marine insurance refers to loss or damage. Review in the chapter the difference between general and particular average. |
| Protection and indemnity coverage contained in an ocean marine policy covers: A. Liability against injuries to seamen; B. Injury to stevedores, longshoreman and harbor workers; C. Cargo, if lost or damaged through negligence; D. All of the above. | D. Protection and indemnity coverage addresses all of these exposures under ocean marine coverage. |
| Protection and indemnity coverage contained in an ocean marine policy covers: A. Guarantee the purpose of the voyage; B. Loss of the shipper fees; C. Marine legal liability for damages caused by the ship; D. Damage to another vessel caused by collision | C. Protection and indemnity coverage provides marine liability for damages caused by the ship (except for collision with another vessel, which is covered under Hull coverage). |
| Although Ocean Marine Hull and Cargo coverages are usually written on an open peril basis, they exclude losses caused by inherent vice. The term "inherent vice" means: A. The potential of property to self-destruct; B. Negligence by masters or members of the crew; C. Losses caused by the dishonesty of crewmembers; D. Any loss resulting from illegal activities | A. Inherent vice, a term found in many property policies, refers to the potential of the property to self-destruct. Bananas will rot; furniture and clothing will eventually wear out. |
| In ocean marine insurance, what is the purpose of the IVEL clause? A. To pay for the loss of shipper's fees; B. To require the insured to take all reasonable steps to protect the property from further loss; C. To provide excess hull and collision liability coverage; D. To cover bulk shipments | C. The purpose of the IVEL clause is to provide excess hull and collision liability coverage. |
| What is meant by "break bulk" cargo? A. Cargo shipped in a tanker ship; B. Cargo that is loosely packed such as ores; C. Loose cargo such as cartons; D. Containerization cargo | C. Break bulk cargo is loose cargo such as cartons stored directly in the ship's hold. Such cargo may be pallets. |
| Which of the following is not essential in determining if a salvage award is to be made? A. Life-saving efforts; B. The property involved must be in peril from some hazard; C. The salvage service must be voluntary; D. The effort must be successful | A. No salvage award is involved solely for life-saving efforts. |
| What is the purpose of freight insurance? A. Covers loss to the cargo; B. Covers shipper fees; C. Covers the insurable interest of the shipper due to jettison of the cargo; D. Covers the cargo until it reaches the warehouse | B. Freight insurance is designed to cover the shipper's fees charged to the shipper. it is the indirect loss/business interruption coverage which comes into play after a direct loss to the vessel. |
| In case of a loss, how many days notice does the insured have after notification of a claim to submit the claim to the underwriters of the ocean marine coverage? A. 90 days; B. 60 days; C. 180 days; D. 30 days | C. If notice is not given within 180 days of an accident or occurrence being known to the assured, owners, or managers, no claim is recoverable. |
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