The commercial vessels and pleasure craft are subject a range of damage and liability risks which can amount to significant financial loss. A comprehensive marine hull insurance program is essential for protecting the assets and earnings of a recreational or commercial hull builder or operator. The Marine Hull Insurance policy is designed to cover physical damage risks inherent in marine operations. It is one of the oldest insurance coverage, and is mainly concerned with the risks arising out of owning and/or operating and/or financing vessels.
Commercial Vessel: Commercial vessels are defined as any mechanically self-propelled water vessel of steel construction, classed with Lloyd’s Register of Shipping or any other internationally recognized classification society.
Pleasure Craft: A pleasure craft (or pleasure boat) is used for personal, family, and sometimes sportsmanlike recreation. Typically such watercrafts are motorized and are used for holidays, for example on a river, lake, canal or waterway, and is not offered or used for hire or reward.
Hull and Machinery Insurance
This insurance is purchased by those responsible for the physical well being of a vessel, be they ship owners, bareboat charterers or third party managers.
Hull & Machinery policy is the mainstay of Marine Insurance. It provides insurance for damage to the hull and machinery and equipment installed on the vessel. The main purpose of Hull & Machinery cover is to comfort the ship owner with an expectation of status quo regarding a vessel’s operational ability during a maritime enterprise. Since marine perils are a risk that the ship owner assumes each venture, he takes out Hull & Machinery cover to protect against losses that may occur to the vessel and her equipment during the enterprise. It is a physical damage policy designed to cover physical loss or damage arising from a marine peril, and will include recovery actions, and all other events associated with physical loss at sea. The policy is adapted to the requirements and fleet profile of the ship owner concerned, and will address levels of deductible, individual vessel valuation, any increased value, and will specify the extent of the cover afforded, whether ‘All Risks’ or ‘Limited Conditions’ or ‘Total Loss Only Cover’.