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Marine Insurance Ordinance


Published: 1997-06-30

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Cap 329 - MARINE INSURANCE ORDINANCE 1

Chapter: 329 MARINE INSURANCE ORDINANCE Gazette Number Version Date

Long title 30/06/1997


To codify the law relating to marine insurance.


[9 June 1961]

(Originally 21 of 1961)

Section: 1 Short title 30/06/1997


This Ordinance may be cited as the Marine Insurance Ordinance.

Section: 2 Marine insurance defined 30/06/1997


MARINE INSURANCE


(1) A contract of marine insurance is a contract whereby the insurer undertakes to indemnify the assured, in
manner and to the extent thereby agreed, against marine losses, that is to say, the losses incident to marine adventure.

(2) A contract of marine insurance may, by its express terms, or by usage of trade, be extended so as to protect
the assured against losses on inland waters or on any land risk which may be incidental to any sea voyage.

(3) Where a ship in course of building, or the launch of a ship, or any adventure analogous to a marine
adventure, is covered by a policy in the form of a marine policy, the provisions of this Ordinance, in so far as
applicable, shall apply thereto; but, except as by this section provided, nothing in this Ordinance shall alter or affect
any rule of law applicable to any contract of insurance other than a contract of marine insurance as by this Ordinance
defined.

[cf. 1906 c. 41 ss. 1 & 2 U.K.]

Section: 3 Marine adventure and maritime perils defined 30/06/1997


(1) Subject to the provisions of this Ordinance, every lawful marine adventure may be the subject of a contract
of marine insurance.

(2) In particular there is a marine adventure where-
(a) any ship goods or other movables are exposed to maritime peril. Such property is in this Ordinance

referred to as "insurable property";
(b) the earning or acquisition of any freight, passage money, commission, profit, or other pecuniary

benefit, or the security for any advances, loan, or disbursements, is endangered by the exposure of
insurable property to maritime perils;

(c) any liability to a third party may be incurred by the owner of, or other person interested in or
responsible for, insurable property, by reason of maritime perils.

(3) For the purposes of this Ordinance, "maritime perils" (海上危險) means the perils consequent on, or
incidental to, the navigation of the sea, that is to say, perils of the seas, fire, war perils, pirates, rovers, thieves,
captures, seizures, restraints, and detainments of princes and peoples, jettisons, barratry, and any other perils, either of
the like kind or which may be designated by the policy.

[cf. 1906 c. 41 s. 3 U.K.]

Section: 4 Avoidance of wagering or gaming contracts 30/06/1997


INSURABLE INTEREST


(1) Every contract of marine insurance by way of gaming or wagering is void.
(2) A contract of marine insurance is deemed to be a gaming or wagering contract-

(a) where the assured has not an insurable interest as defined by this Ordinance, and the contract is entered



Cap 329 - MARINE INSURANCE ORDINANCE 2

into with no expectation of acquiring such an interest; or
(b) where the policy is made "interest or no interest", or "without further proof of interest than the policy

itself", or "without benefit of salvage to the insurer", or subject to any other like term:
Provided that, where there is no possibility of salvage, a policy may be effected without benefit

of salvage to the insurer.
[cf. 1906 c. 41 s. 4 U.K.]


Section: 5 Insurable interest defined 30/06/1997


(1) Subject to the provisions of this Ordinance, every person has an insurable interest who is interested in a
marine adventure.

(2) In particular a person is interested in a marine adventure where he stands in any legal or equitable relation
to the adventure or to any insurable property at risk therein, in consequence of which he may benefit by the safety or
due arrival of insurable property, or may be prejudiced by its loss, or by damage thereto, or by the detention thereof, or
may incur liability in respect thereof.

[cf. 1906 c. 41 s. 5 U.K.]

Section: 6 When interest must attach 30/06/1997


(1) The assured must be interested in the subject-matter insured at the time of the loss though he need not be
interested when the insurance is effected:

Provided that where the subject-matter is insured "lost or not lost", the assured may recover although he may not
have acquired his interest until after the loss, unless at the time of effecting the contract of insurance the assured was
aware of the loss, and the insurer was not.

(2) Where the assured has no interest at the time of the loss, he cannot acquire interest by any act or election
after he is aware of the loss.

[cf. 1906 c. 41 s. 6 U.K.]

Section: 7 Defeasible or contingent interest 30/06/1997


(1) A defeasible interest is insurable, as also is a contingent interest.
(2) In particular, where the buyer of goods has insured them, he has an insurable interest, notwithstanding that

he might, at his election, have rejected the goods, or have treated them as at the seller's risk, by reason of the latter's
delay in making delivery or otherwise.

[cf. 1906 c. 41 s. 7 U.K.]

Section: 8 Partial interest 30/06/1997


A partial interest of any nature is insurable.
[cf. 1906 c. 41 s. 8 U.K.]


Section: 9 Re-insurance 30/06/1997


(1) The insurer under a contract of marine insurance has an insurable interest in his risk, and may re-insure in
respect of it.

(2) Unless the policy otherwise provides, the original assured has no right or interest in respect of such re-
insurance.

[cf. 1906 c. 41 s. 9 U.K.]

Section: 10 Bottomry 30/06/1997


The lender of money on bottomry or respondentia has an insurable interest in respect of the loan.
[cf. 1906 c. 41 s. 10 U.K.]





Cap 329 - MARINE INSURANCE ORDINANCE 3

Section: 11 Master's and seamen's wages 30/06/1997


The master or any member of the crew of a ship has an insurable interest in respect of his wages.
[cf. 1906 c. 41 s. 11 U.K.]


Section: 12 Advance freight 30/06/1997


In the case of advance freight, the person advancing the freight has an insurable interest, in so far as such freight
is not repayable in case of loss.

[cf. 1906 c. 41 s. 12 U.K.]

Section: 13 Charges of insurance 30/06/1997


The assured has an insurable interest in the charges of any insurance which he may effect.
[cf. 1906 c. 41 s. 13 U.K.]


Section: 14 Quantum of interest 30/06/1997


(1) Where the subject-matter insured is mortgaged, the mortgagor has an insurable interest in the full value
thereof, and the mortgagee has an insurable interest in respect of any sum due or to become due under the mortgage.

(2) A mortgagee, consignee, or other person having an interest in the subject-matter insured may insure on
behalf and for the benefit of other persons interested as well as for his own benefit.

(3) The owner of insurable property has an insurable interest in respect of the full value thereof,
notwithstanding that some third person may have agreed, or be liable, to indemnify him in case of loss.

[cf. 1906 c. 41 s. 14 U.K.]

Section: 15 Assignment of interest 30/06/1997


Where the assured assigns or otherwise parts with his interest in the subject-matter insured, he does not thereby
transfer to the assignee his rights under the contract of insurance, unless there be an express or implied agreement with
the assignee to that effect.

But the provisions of this section do not affect a transmission of interest by operation of law.
[cf. 1906 c. 41 s. 15 U.K.]


Section: 16 Measure of insurable value 30/06/1997


INSURABLE VALUE


Subject to any express provision or valuation in the policy, the insurable value of the subject-matter insured must
be ascertained as follows-

(a) in insurance on ship, the insurable value is the value, at the commencement of the risk, of the ship,
including her outfit, provisions and stores for the officers and crew, money advanced for seamen's
wages, and other disbursements (if any) incurred to make the ship fit for the voyage or adventure
contemplated by the policy, plus the charges of insurance upon the whole:

The insurable value, in the case of a steamship, includes also the machinery, boilers, and coals
and engine stores if owned by the assured, and, in the case of a ship engaged in a special trade, the
ordinary fittings requisite for that trade;

(b) in insurance on freight, whether paid in advance or otherwise, the insurable value is the gross amount
of the freight at the risk of the assured, plus the charges of insurance;

(c) in insurance on goods or merchandise, the insurable value is the prime cost of the property insured,
plus the expenses of and incidental to shipping and the charges of insurance upon the whole;

(d) in insurance on any other subject-matter, the insurable value is the amount at the risk of the assured
when the policy attaches, plus the charges of insurance.

[cf. 1906 c. 41 s. 16 U.K.]



Cap 329 - MARINE INSURANCE ORDINANCE 4


Section: 17 Insurance is uberrimoe fidei 30/06/1997


DISCLOSURE AND REPRESENTATIONS


A contract of marine insurance is a contract based upon the utmost good faith, and, if the utmost good faith be
not observed by either party, the contract may be avoided by the other party.

[cf. 1906 c. 41 s. 17 U.K.]

Section: 18 Disclosure by assured 30/06/1997


(1) Subject to the provisions of this section, the assured must disclose to the insurer, before the contract is
concluded, every material circumstance which is known to the assured, and the assured is deemed to know every
circumstance which, in the ordinary course of business, ought to be known by him. If the assured fails to make such
disclosure, the insurer may avoid the contract.

(2) Every circumstance is material which would influence the judgment of a prudent insurer in fixing the
premium, or determining whether he will take the risk.

(3) In the absence of inquiry the following circumstances need not be disclosed, namely-
(a) any circumstance which diminishes the risk;
(b) any circumstance which is known or presumed to be known to the insurer. The insurer is presumed to

know matters of common notoriety or knowledge, and matters which an insurer in the ordinary course
of his business, as such, ought to know;

(c) any circumstance as to which information is waived by the insurer;
(d) any circumstance which it is superfluous to disclose by reason of any express or implied warranty.

(4) Whether any particular circumstance, which is not disclosed, be material or not is, in each case, a question
of fact.

(5) The term "circumstance" (情況) includes any communication made to, or information received by, the
assured.

[cf. 1906 c. 41 s. 18 U.K.]

Section: 19 Disclosure by agent effecting insurance 30/06/1997


Subject to the provisions of section 18 as to circumstances which need not be disclosed, where an insurance is
effected for the assured by an agent, the agent must disclose to the insurer-

(a) every material circumstance which is known to himself and an agent to insure is deemed to know
every circumstance which in the ordinary course of business ought to be known by, or to have been
communicated to, him; and

(b) every material circumstance which the assured is bound to disclose, unless it comes to his knowledge
too late to communicate it to the agent.

[cf. 1906 c. 41 s. 19 U.K.]

Section: 20 Representations pending negotiation of contract 30/06/1997


(1) Every material representation made by the assured or his agent to the insurer during the negotiations for the
contract, and before the contract is concluded, must be true. If it be untrue the insurer may avoid the contract.

(2) A representation is material which would influence the judgment of a prudent insurer in fixing the
premium, or determining whether he will take the risk.

(3) A representation may be either a representation as to a matter of fact, or as to a matter of expectation or
belief.

(4) A representation as to a matter of fact is true, if it be substantially correct, that is to say, if the difference
between what is represented and what is actually correct would not be considered material by a prudent insurer.

(5) A representation as to a matter of expectation or belief is true if it be made in good faith.
(6) A representation may be withdrawn or corrected before the contract is concluded.
(7) Whether a particular representation be material or not is, in each case, a question of fact.



Cap 329 - MARINE INSURANCE ORDINANCE 5

[cf. 1906 c. 41 s. 20 U.K.]

Section: 21 When contract is deemed to be concluded 30/06/1997


A contract of marine insurance is deemed to be concluded when the proposal of the assured is accepted by the
insurer, whether the policy be then issued or not; and, for the purpose of showing when the proposal was accepted,
reference may be made to the slip or covering note or other customary memorandum of the contract.

[cf. 1906 c. 41 s. 21 U.K.]

Section: 22 Contract must be embodied in policy 30/06/1997


THE POLICY


Subject to the provisions of any Ordinance, a contract of marine insurance is inadmissible in evidence unless it is
embodied in a marine policy in accordance with this Ordinance. The policy may be executed and issued either at the
time when the contract is concluded, or afterwards.

[cf. 1906 c. 41 s. 22 U.K.]

Section: 23 What policy must specify 30/06/1997


A marine policy must specify the name of the assured, or of some person who effects the insurance on his
behalf.

[cf. 1906 c. 41 s. 23 U.K.]

Section: 24 Signature of insurer 30/06/1997


(1) A marine policy must be signed by or on behalf of the insurer, provided that in the case of a corporation the
corporate seal may be sufficient, but nothing in this section shall be construed as requiring the subscription of a
corporation to be under seal.

(2) Where a policy is subscribed by or on behalf of two or more insurers, each subscription, unless the contrary
be expressed, constitutes a distinct contract with the assured.

[cf. 1906 c. 41 s. 24 U.K.]

Section: 25 Voyages and time policies 30/06/1997


Where the contract is to insure the subject-matter "at and from", or from one place to another or others, the
policy is called a "voyage policy", and where the contract is to insure the subject-matter for a definite period of time
the policy is called a "time policy". A contract for both voyage and time may be included in the same policy.

[cf. 1906 c. 41 s. 25 U.K.]

Section: 26 Designation of subject-matter 30/06/1997


(1) The subject-matter insured must be designated in a marine policy with reasonable certainty.
(2) The nature and extent of the interest of the assured in the subject-matter insured need not be specified in the

policy.
(3) Where the policy designates the subject-matter insured in general terms, it shall be construed to apply to the

interest intended by the assured to be covered.
(4) In the application of this section regard shall be had to any usage regulating the designation of the subject-

matter insured.
[cf. 1906 c. 41 s. 26 U.K.]


Section: 27 Valued policy 30/06/1997


(1) A policy may be either valued or unvalued.



Cap 329 - MARINE INSURANCE ORDINANCE 6

(2) A valued policy is a policy which specifies the agreed value of the subject-matter insured.
(3) Subject to the provisions of this Ordinance, and in the absence of fraud, the value fixed by the policy is, as

between the insurer and assured, conclusive of the insurable value of the subject intended to be insured, whether the
loss be total or partial.

(4) Unless the policy otherwise provides, the value fixed by the policy is not conclusive for the purpose of
determining whether there has been a constructive total loss.

[cf. 1906 c. 41 s. 27 U.K.]

Section: 28 Unvalued policy 30/06/1997


An unvalued policy is a policy which does not specify the value of the subject-matter insured, but subject to the
limit of the sum insured, leaves the insurable value to be subsequently ascertained, in the manner hereinbefore
specified.

[cf. 1906 c. 41 s. 28 U.K.]

Section: 29 Floating policy by ship or ships 30/06/1997


(1) A floating policy is a policy which describes the insurance in general terms, and leaves the name of the ship
or ships and other particulars to be defined by subsequent declaration.

(2) The subsequent declaration or declarations may be made by endorsement on the policy, or in other
customary manner.

(3) Unless the policy otherwise provides, the declarations must be made in the order of dispatch or shipment.
They must, in the case of goods, comprise all consignments within the terms of the policy, and the value of the goods
or other property must be honestly stated, but an omission or erroneous declaration may be rectified even after loss or
arrival, provided the omission or declaration was made in good faith.

(4) Unless the policy otherwise provides, where a declaration of value is not made until after notice of loss or
arrival, the policy must be treated as an unvalued policy as regards the subject- matter of that declaration.

[cf. 1906 c. 41 s. 29 U.K.]

Section: 30 Construction of terms in policy 30/06/1997


(1) A policy may be in the form in the Schedule.
(2) Subject to the provisions of this Ordinance, and unless the context of the policy otherwise requires, the

terms and expressions mentioned in the Schedule shall be construed as having the scope and meaning in that schedule
assigned to them.

[cf. 1906 c. 41 s. 30 U.K.]

Section: 31 Premium to be arranged 30/06/1997


(1) Where an insurance is effected at a premium to be arranged, and no arrangement is made, a reasonable
premium is payable.

(2) Where an insurance is effected on the terms that an additional premium is to be arranged in a given event,
and that event happens but no arrangement is made, then a reasonable additional premium is payable.

[cf. 1906 c. 41 s. 31 U.K.]

Section: 32 Double insurance 30/06/1997


DOUBLE INSURANCE


(1) Where two or more policies are effected by or on behalf of the assured on the same adventure and interest
or any part thereof, and the sums insured exceed the indemnity allowed by this Ordinance, the assured is said to be
over-insured by double insurance.

(2) Where the assured is over-insured by double insurance-
(a) the assured, unless the policy otherwise provides, may claim payment from the insurers in such order



Cap 329 - MARINE INSURANCE ORDINANCE 7

as he may think fit, provided that he is not entitled to receive any sum in excess of the indemnity
allowed by this Ordinance;

(b) where the policy under which the assured claims is a valued policy, the assured must give credit as
against the valuation for any sum received by him under any other policy without regard to the actual
value of the subject-matter insured;

(c) where the policy under which the assured claims is an unvalued policy he must give credit, as against
the full insurable value, for any sum received by him under any other policy;

(d) where the assured receives any sum in excess of the indemnity allowed by this Ordinance, he is
deemed to hold such sum in trust for the insurers, according to their right of contribution among
themselves.

[cf. 1906 c. 41 s. 32 U.K.]

Section: 33 Nature of warranty 30/06/1997


WARRANTIES, ETC.


(1) A warranty, in the following sections relating to warranties, means a promissory warranty, that is to say, a
warranty by which the assured undertakes that some particular thing shall or shall not he done, or that some condition
shall be fulfilled, or whereby he affirms or negatives the existence of a particular state of facts.

(2) A warranty may be express or implied.
(3) A warranty, as above defined, is a condition which must be exactly complied with, whether it be material to

the risk or not. If it be not so complied with, then, subject to any express provision in the policy, the insurer is
discharged from liability as from the date of the breach of warranty, but without prejudice to any liability incurred by
him before that date.

[cf. 1906 c. 41 s. 33 U.K.]

Section: 34 When breach of warranty excused 30/06/1997


(1) Non-compliance with a warranty is excused when, by reason of a change of circumstances, the warranty
ceases to be applicable to the circumstances of the contract, or when compliance with the warranty is rendered
unlawful by any subsequent law.

(2) Where a warranty is broken, the assured cannot avail himself of the defence that the breach has been
remedied, and the warranty complied with, before loss.

(3) A breach of warranty may be waived by the insurer.
[cf. 1906 c. 41 s. 34 U.K.]


Section: 35 Express warranties 30/06/1997


(1) An express warranty may be in any form of words from which the intention to warrant is to be inferred.
(2) An express warranty must be included in, or written upon, the policy, or must be contained in some

document incorporated by reference into the policy.
(3) An express warranty does not exclude an implied warranty, unless it be inconsistent therewith.

[cf. 1906 c. 41 s. 35 U.K.]

Section: 36 Warranty of neutrality 30/06/1997


(1) Where insurable property, whether ship or goods, is expressly warranted neutral, there is an implied
condition that the property shall have a neutral character at the commencement of the risk, and that, so far as the
assured can control the matter, its neutral character shall be preserved during the risk.

(2) Where a ship is expressly warranted "neutral" there is also an implied condition that, so far as the assured
can control the matter, she shall be properly documented, that is to say, that she shall carry the necessary papers to
establish her neutrality, and that she shall not falsify or suppress her papers, or use simulated papers. If any loss occurs
through breach of this condition, the insurer may avoid the contract.

[cf. 1906 c. 41 s. 36 U.K.]



Cap 329 - MARINE INSURANCE ORDINANCE 8


Section: 37 No implied warranty of nationality 30/06/1997


There is no implied warranty as to the nationality of a ship, or that her nationality shall not be changed during
the risk.

[cf. 1906 c. 41 s. 37 U.K.]

Section: 38 Warranty of good safety 30/06/1997


Where the subject-matter insured is warranted "well" or "in good safety" on a particular day, it is sufficient if it
be safe at any time during that day.

[cf. 1906 c. 41 s. 38 U.K.]

Section: 39 Warranty of seaworthiness of ship 30/06/1997


(1) In a voyage policy there is an implied warranty that at the commencement of the voyage the ship shall be
seaworthy for the purpose of the particular adventure insured.

(2) Where the policy attaches while the ship is in port, there is also an implied warranty that she shall, at the
commencement of the risk, be reasonably fit to encounter the ordinary perils of the port.

(3) Where the policy relates to a voyage which is performed in different stages, during which the ship requires
different kinds of or further preparation or equipment, there is an implied warranty that at the commencement of each
stage the ship is seaworthy in respect of such preparation or equipment for the purposes of that stage.

(4) A ship is deemed to be seaworthy when she is reasonably fit in all respects to encounter the ordinary perils
of the seas of the adventure insured.

(5) In a time policy there is no implied warranty that the ship shall be seaworthy at any stage of the adventure,
but where, with the privity of the assured the ship is sent to sea in an unseaworthy state, the insurer is not liable for
any loss attributable to unseaworthiness.

[cf. 1906 c. 41 s. 39 U.K.]

Section: 40 No implied warranty that goods are seaworthy 30/06/1997


(1) In a policy on goods or other movables there is no implied warranty that the goods or movables are
seaworthy.

(2) In a voyage policy on goods or other movables there is an implied warranty that at the commencement of
the voyage the ship is not only seaworthy as a ship, but also that she is reasonably fit to carry the goods or other
movables to the destination contemplated by the policy.

[cf. 1906 c. 41 s. 40 U.K.]

Section: 41 Warranty of legality 30/06/1997


There is an implied warranty that the adventure insured is a lawful one, and that, so far as the assured can control
the matter, the adventure shall be carried out in a lawful manner.

[cf. 1906 c. 41 s. 41 U.K.]

Section: 42 Implied condition as to commencement of risk 30/06/1997


THE VOYAGE


(1) Where the subject-matter is insured by a voyage policy "at and from" or "from" a particular place, it is not
necessary that the ship should be at that place when the contract is concluded, but there is an implied condition that the
adventure shall be commenced within a reasonable time, and that if the adventure be not so commenced the insurer
may avoid the contract.

(2) The implied condition may be negatived by showing that the delay was caused by circumstances known to
the insurer before the contract was concluded, or by showing that he waived the condition.



Cap 329 - MARINE INSURANCE ORDINANCE 9

[cf. 1906 c. 41 s. 42 U.K.]

Section: 43 Alteration of port of departure 30/06/1997


Where the place of departure is specified by the policy, and the ship instead of sailing from that place sails from
any other place, the risk does not attach.

[cf. 1906 c. 41 s. 43 U.K.]

Section: 44 Sailing for different destination 30/06/1997


Where the destination is specified in the policy, and the ship, instead of sailing for that destination, sails for any
other destination, the risk does not attach.

[cf. 1906 c. 41 s. 44 U.K.]

Section: 45 Change of voyage 30/06/1997


(1) Where, after the commencement of the risk, the destination of the ship is voluntarily changed from the
destination contemplated by the policy, there is said to be a change of voyage.

(2) Unless the policy otherwise provides, where there is a change of voyage, the insurer is discharged from
liability as from the time of change, that is to say, as from the time when the determination to change it is manifested;
and it is immaterial that the ship may not in fact have left the course of voyage contemplated by the policy when the
loss occurs.

[cf. 1906 c. 41 s. 45 U.K.]

Section: 46 Deviation 30/06/1997


(1) Where a ship, without lawful excuse, deviates from the voyage contemplated by the policy, the insurer is
discharged from liability as from the time of deviation, and it is immaterial that the ship may have regained her route
before any loss occurs.

(2) There is a deviation from the voyage contemplated by the policy-
(a) where the course of the voyage is specifically designated by the policy, and that course is departed

from; or
(b) where the course of the voyage is not specifically designated by the policy, but the usual and

customary course is departed from.
(3) The intention to deviate is immaterial; there must be a deviation in fact to discharge the insurer from his

liability under the contract.
[cf. 1906 c. 41 s. 46 U.K.]


Section: 47 Several ports of discharge 30/06/1997


(1) Where several ports of discharge are specified by the policy, the ship may proceed to all or any of them,
but, in the absence of any usage or sufficient cause to the contrary, she must proceed to them, or such of them as she
goes to, in the order designated by the policy. If she does not there is a deviation.

(2) Where the policy is to "ports of discharge", within a given area, which are not named, the ship must, in the
absence of any usage or sufficient cause to the contrary, proceed to them, or such of them as she goes to, in their
geographical order. If she does not there is a deviation.

[cf. 1906 c. 41 s. 47 U.K.]

Section: 48 Delay in voyage 30/06/1997


In the case of a voyage policy, the adventure insured must be prosecuted throughout its course with reasonable
dispatch, and if without lawful excuse it is not so prosecuted, the insurer is discharged from liability as from the time
when the delay became unreasonable.

[cf. 1906 c. 41 s. 48 U.K.]



Cap 329 - MARINE INSURANCE ORDINANCE 10


Section: 49 Excuses for deviation or delay 30/06/1997


(1) Deviation or delay in prosecuting the voyage contemplated by the policy is excused-
(a) where authorized by any special term in the policy; or
(b) where caused by circumstances beyond the control of the master and his employer; or
(c) where reasonably necessary in order to comply with an express or implied warranty; or
(d) where reasonably necessary for the safety of the ship or subject-matter insured; or
(e) for the purpose of saving human life, or aiding a ship in distress where human life may be in danger; or
(f) where reasonably necessary for the purpose of obtaining medical or surgical aid for any person on

board the ship; or
(g) where caused by the barratrous conduct of the master or crew, if barratry be one of the perils insured

against.
(2) When the cause excusing the deviation or delay ceases to operate, the ship must resume her course, and

prosecute her voyage, with reasonable dispatch.
[cf. 1906 c. 41 s. 49 U.K.]


Section: 50 When and how policy is assignable 30/06/1997


ASSIGNMENT OF POLICY


(1) A marine policy is assignable unless it contains terms expressly prohibiting assignment. It may be assigned
either before or after loss.

(2) Where a marine policy has been assigned so as to pass the beneficial interest in such policy, the assignee of
the policy is entitled to sue thereon in his own name; and the defendant is entitled to make any defence arising out of
the contract which he would have been entitled to make if the action had been brought in the name of the person by or
on behalf of whom the policy was effected.

(3) A marine policy may be assigned by endorsement thereon or in other customary manner.
[cf. 1906 c. 41 s. 50 U.K.]


Section: 51 Assured who has no interest cannot assign 30/06/1997


Where the assured has parted with or lost his interest in the subject-matter insured, and has not, before or at the
time of so doing, expressly or impliedly agreed to assign the policy, any subsequent assignment of the policy is
inoperative:

Provided that nothing in this section affects the assignment of a policy after loss.
[cf. 1906 c. 41 s. 51 U.K.]


Section: 52 When premium payable 30/06/1997


THE PREMIUM


Unless otherwise agreed, the duty of the assured or his agent to pay the premium, and the duty of the insurer to
issue the policy to the assured or his agent, are concurrent conditions, and the insurer is not bound to issue the policy
until payment or tender of the premium.

[cf. 1906 c. 41 s. 52 U.K.]

Section: 53 Policy effected through broker 30/06/1997


(1) Unless otherwise agreed, where a marine policy is effected on behalf of the assured by a broker, the broker
is directly responsible to the insurer for the premium, and the insurer is directly responsible to the assured for the
amount which may be payable in respect of losses, or in respect of returnable premium.

(2) Unless otherwise agreed, the broker has, as against the assured, a lien upon the policy for the amount of the
premium and his charges in respect of effecting the policy; and, where he has dealt with the person who employs him



Cap 329 - MARINE INSURANCE ORDINANCE 11

as a principal, he has also a lien on the policy in respect of any balance on any insurance account which may be due to
him from such person, unless when the debt was incurred he had reason to believe that such person was only an agent.

[cf. 1906 c. 41 s. 53 U.K.]

Section: 54 Effect of receipt on policy 30/06/1997


Where a marine policy effected on behalf of the assured by a broker acknowledges the receipt of the premium,
such acknowledgment is, in the absence of fraud, conclusive as between the insurer and the assured, but not as
between the insurer and broker.

[cf. 1906 c. 41 s. 54 U.K.]

Section: 55 Included and excluded losses 30/06/1997


LOSS AND ABANDONMENT


(1) Subject to the provisions of this Ordinance, and unless the policy otherwise provides, the insurer is liable
for any loss proximately caused by a peril insured against, but, subject as aforesaid, he is not liable for any loss which
is not proximately caused by a peril insured against.

(2) In particular-
(a) the insurer is not liable for any loss attributable to the wilful misconduct of the assured, but, unless the

policy otherwise provides, he is liable for any loss proximately caused by a peril insured against, even
though the loss would not have happened but for the misconduct or negligence of the master or crew;

(b) unless the policy otherwise provides, the insurer on ship or goods is not liable for any loss proximately
caused by delay, although the delay be caused by a peril insured against;

(c) unless the policy otherwise provides, the insurer is not liable for ordinary wear and tear, ordinary
leakage and breakage, inherent vice or nature of the subject-matter insured, or for any loss proximately
caused by rats or vermin, or for any injury to machinery not proximately caused by maritime perils.

[cf. 1906 c. 41 s. 55 U.K.]

Section: 56 Partial and total loss 30/06/1997


(1) A loss may be either total or partial. Any loss other than a total loss, as hereinafter defined, is a partial loss.
(2) A total loss may be either an actual total loss, or a constructive total loss.
(3) Unless a different intention appears from the terms of the policy, an insurance against total loss includes a

constructive, as well as an actual, total loss.
(4) Where the assured brings an action for a total loss and the evidence proves only a partial loss, he may,

unless the policy otherwise provides, recover for a partial loss.
(5) Where goods reach their destination in specie, but by reason of obliteration of marks, or otherwise, they are

incapable of identification, the loss, if any, is partial, and not total.
[cf. 1906 c. 41 s. 56 U.K.]


Section: 57 Actual total loss 30/06/1997


(1) Where the subject-matter insured is destroyed, or so damaged as to cease to be a thing of the kind insured,
or where the assured is irretrievably deprived thereof, there is an actual total loss.

(2) In the case of an actual total loss no notice of abandonment need be given.
[cf. 1906 c. 41 s. 57 U.K.]


Section: 58 Missing ship 30/06/1997


Where the ship concerned in the adventure is missing, and after the lapse of a reasonable time no news of her has
been received, an actual total loss may be presumed.

[cf. 1906 c. 41 s. 58 U.K.]




Cap 329 - MARINE INSURANCE ORDINANCE 12

Section: 59 Effect of transhipment, etc. 30/06/1997


Where, by a peril insured against, the voyage is interrupted at an intermediate port or place, under such
circumstances as, apart from any special stipulation in the contract of affreightment, to justify the master in landing
and re-shipping the goods or other movables, or in transhipping them, and sending them on to their destination, the
liability of the insurer continues notwithstanding the landing or transhipment.

[cf. 1906 c. 41 s. 59 U.K.]

Section: 60 Constructive total loss defined 30/06/1997


(1) Subject to any express provision in the policy, there is a constructive total loss where the subject-matter
insured is reasonably abandoned on account of its actual total loss appearing to be unavoidable, or because it could not
be preserved from actual total loss without an expenditure which would exceed its value when the expenditure had
been incurred.

(2) In particular, there is a constructive total loss-
(a) where the assured is deprived of the possession of his ship or goods by a peril insured against, and (i) it

is unlikely that he can recover the ship or goods, as the case may be, or (ii) the cost of recovering the
ship or goods, as the case may be, would exceed their value when recovered; or

(b) in the case of damage to a ship, where she is so damaged by a peril insured against that the cost of
repairing the damage would exceed the value of the ship when repaired.

In estimating the cost of repairs, no deduction is to be made in respect of general average
contributions to those repairs payable by other interests, but account is to be taken of the expense of
future salvage operations and of any future general average contributions to which the ship would be
liable if repaired; or

(c) in the case of damage to goods, where the cost of repairing the damage and forwarding the goods to
their destination would exceed their value on arrival.

[cf. 1906 c. 41 s. 60 U.K.]

Section: 61 Effect of constructive total loss 30/06/1997


Where there is a constructive total loss the assured may either treat the loss as a partial loss, or abandon the
subject-matter insured to the insurer and treat the loss as if it were an actual total loss.

[cf. 1906 c. 41 s. 61 U.K.]

Section: 62 Notice of abandonment 30/06/1997


(1) Subject to the provisions of this section, where the assured elects to abandon the subject-matter insured to
the insurer, he must give notice of abandonment. If he fails to do so the loss can only be treated as a partial loss.

(2) Notice of abandonment may be given in writing, or by word of mouth, or partly in writing and partly by
word of mouth, and may be given in any terms which indicate the intention of the assured to abandon his insured
interest in the subject-matter insured unconditionally to the insurer.

(3) Notice of abandonment must be given with reasonable diligence after the receipt of reliable information of
the loss, but where the information is of a doubtful character the assured is entitled to a reasonable time to make
inquiry.

(4) Where notice of abandonment is properly given, the rights of the assured are not prejudiced by the fact that
the insurer refuses to accept the abandonment.

(5) The acceptance of an abandonment may be either express or implied from the conduct of the insurer. The
mere silence of the insurer after notice is not an acceptance.

(6) Where notice of abandonment is accepted the abandonment is irrevocable. The acceptance of the notice
conclusively admits liability for the loss and the sufficiency of the notice.

(7) Notice of abandonment is unnecessary where, at the time when the assured receives information of the loss,
there would be no possibility of benefit to the insurer if notice were given to him.

(8) Notice of abandonment may be waived by the insurer.
(9) Where an insurer has re-insured his risk, no notice of abandonment need be given by him.



Cap 329 - MARINE INSURANCE ORDINANCE 13

[cf. 1906 c. 41 s. 62 U.K.]

Section: 63 Effect of abandonment 30/06/1997


(1) Where there is a valid abandonment the insurer is entitled to take over the interest of the assured in
whatever may remain of the subject-matter insured, and all proprietary rights incidental thereto.

(2) Upon the abandonment of a ship, the insurer thereof is entitled to any freight in course of being earned, and
which is earned by her subsequent to the casualty causing the loss, less the expenses of earning it incurred after the
casualty; and, where the ship is carrying the owner's goods, the insurer is entitled to a reasonable remuneration for the
carriage of them subsequent to the casualty causing the loss.

[cf. 1906 c. 41 s. 63 U.K.]

Section: 64 Particular average loss 30/06/1997


PARTIAL LOSSES (INCLUDING SALVAGE AND GENERAL AVERAGE
AND PARTICULAR CHARGES)


(1) A particular average loss is a partial loss of the subject-matter insured, caused by a peril insured against,

and which is not a general average loss.
(2) Expenses incurred by or on behalf of the assured for the safety or preservation of the subject-matter insured,

other than general average and salvage charges, are called particular charges. Particular charges are not included in
particular average.

[cf. 1906 c. 41 s. 64 U.K.]

Section: 65 Salvage charges 30/06/1997


(1) Subject to any express provision in the policy, salvage charges incurred in preventing a loss by perils
insured against may be recovered as a loss by those perils.

(2) "Salvage charges" (救助費用 ) means the charges recoverable under maritime law by a salvor
independently of contract. They do not include the expenses of services in the nature of salvage rendered by the
assured or his agents, or any person employed for hire by them, for the purpose of averting a peril insured against.
Such expenses, where properly incurred, may be recovered as particular charges or as a general average loss,
according to the circumstances under which they were incurred.

[cf. 1906 c. 41 s. 65 U.K.]

Section: 66 General average loss 30/06/1997


(1) A general average loss is a loss caused by or directly consequential on a general average act. It includes a
general average expenditure as well as a general average sacrifice.

(2) There is a general average act where any extraordinary sacrifice or expenditure is voluntarily and
reasonably made or incurred in time of peril for the purpose of preserving the property imperilled in the common
adventure.

(3) Where there is a general average loss, the party on whom it falls is entitled, subject to the conditions
imposed by maritime law, to a rateable contribution from the other parties interested, and such contribution is called a
general average contribution.

(4) Subject to any express provision in the policy, where the assured has incurred a general average
expenditure, he may recover from the insurer in respect of the proportion of the loss which falls upon him; and, in the
case of a general average sacrifice, he may recover from the insurer in respect of the whole loss without having
enforced his right of contribution from the other parties liable to contribute.

(5) Subject to any express provision in the policy, where the assured has paid, or is liable to pay, a general
average contribution in respect of the subject insured, he may recover therefor from the insurer.

(6) In the absence of express stipulation, the insurer is not liable for any general average loss or contribution
where the loss was not incurred for the purpose of avoiding, or in connection with the avoidance of, a peril insured
against.



Cap 329 - MARINE INSURANCE ORDINANCE 14

(7) Where ship, freight, and cargo, or any two of those interests, are owned by the same assured, the liability of
the insurer in respect of general average losses or contributions is to be determined as if those subjects were owned by
different persons.

[cf. 1906 c. 41 s. 66 U.K.]

Section: 67 Extent of liability of insurer for loss 30/06/1997


MEASURE OF INDEMNITY


(1) The sum which the assured can recover in respect of a loss on a policy by which he is insured, in the case of
an unvalued policy to the full extent of ,the insurable value, or, in the case of a valued policy to the full extent of the
value fixed by the policy, is called the measure of indemnity.

(2) Where there is a loss recoverable under the policy, the insurer, or each insurer if there be more than one, is
liable for such proportion of the measure of indemnity as the amount of his subscription bears to the value fixed by the
policy in the case of a valued policy, or to the insurable value in the case of an unvalued policy.

[cf. 1906 c. 41 s. 67 U.K.]

Section: 68 Total loss 30/06/1997


Subject to the provisions of this Ordinance and to any express provision in the policy, where there is a total loss
of the subject-matter insured-

(a) if the policy be a valued policy, the measure of indemnity is the sum fixed by the policy;
(b) if the policy be an unvalued policy, the measure of indemnity is the insurable value of the subject-

matter insured.
[cf. 1906 c. 41 s. 68 U.K.]


Section: 69 Partial loss of ship 30/06/1997


Where a ship is damaged, but is not totally lost, the measure of indemnity, subject to any express provision in
the policy, is as follows-

(a) where the ship has been repaired, the assured is entitled to the reasonable cost of the repairs, less the
customary deductions, but not exceeding the sum insured in respect of any one casualty;

(b) where the ship has been only partially repaired, the assured is entitled to the reasonable cost of such
repairs, computed as above, and also to be indemnified for the reasonable depreciation, if any, arising
from the unrepaired damage, provided that the aggregate amount shall not exceed the cost of repairing
the whole damage, computed as above;

(c) where the ship has not been repaired, and has not been sold in her damaged state during the risk, the
assured is entitled to be indemnified for the reasonable depreciation arising from the unrepaired
damage, but not exceeding the reasonable cost of repairing such damage, computed as above.

[cf. 1906 c. 41 s. 69 U.K.]

Section: 70 Partial loss of freight 30/06/1997


Subject to any express provision in the policy, where there is a partial loss of freight, the measure of indemnity is
such proportion of the sum fixed by the policy in the case of a valued policy, or of the insurable value in the case of an
unvalued policy, as the proportion of freight lost by the assured bears to the whole freight at the risk of the assured
under the policy.

[cf. 1906 c. 41 s. 70 U.K.]

Section: 71 Partial loss of goods, merchandise, etc. 30/06/1997


Where there is a partial loss of goods, merchandise, or other movables, the measure of indemnity, subject to any
express provision in the policy, is as follows-

(a) where part of the goods, merchandise or other movables insured by a valued policy is totally lost, the



Cap 329 - MARINE INSURANCE ORDINANCE 15

measure of indemnity is such proportion of the sum fixed by the policy as the insurable value of the
part lost bears to the insurable value of the whole, ascertained as in the case of an unvalued policy;

(b) where part of the goods, merchandise, or other movables insured by an unvalued policy is totally lost,
the measure of indemnity is the insurable value of the part lost, ascertained as in case of total loss;

(c) where the whole or any part of the goods or merchandise insured has been delivered damaged at its
destination, the measure of indemnity is such proportion of the sum fixed by the policy in the case of a
valued policy, or of the insurable value in the case of an unvalued policy, as the difference between the
gross sound and damaged values at the place of arrival bears to the gross sound value;

(d) "Gross value" (毛值) means the wholesale price or, if there be no such price, the estimated value,
with, in either case, freight, landing charges, and duty paid beforehand; provided that, in the case of
goods or merchandise customarily sold in bond, the bonded price is deemed to be the gross value.
"Gross proceeds" (毛收益) means the actual price obtained at a sale where all charges on sale are paid
by the sellers.

[cf. 1906 c. 41 s. 71 U.K.]

Section: 72 Apportionment of valuation 30/06/1997


(1) Where different species of property are insured under a single valuation, the valuation must be apportioned
over the different species in proportion to their respective insurable values, as in the case of an unvalued policy. The
insured value of any part of a species is such proportion of the total insured value of the same as the insurable value of
the part bears to the insurable value of the whole, ascertained in both cases as provided by this Ordinance.

(2) Where a valuation has to be apportioned, and particulars of the prime cost of each separate species, quality,
or description of goods cannot be ascertained, the division of the valuation may be made over the net arrived sound
values of the different species, qualities, or descriptions of goods.

[cf. 1906 c. 41 s. 72 U.K.]

Section: 73 General average contributions and salvage charges 30/06/1997


(1) Subject to any express provision in the policy, where the assured has paid, or is liable for, any general
average contribution, the measure of indemnity is the full amount of such contribution, if the subject-matter liable to
contribution is insured for its full contributory value; but, if such subject-matter be not insured for its full contributory
value, or if only part of it be insured, the indemnity payable by the insurer must be reduced in proportion to the under
insurance, and where there has been a particular average loss which constitutes a deduction from the contributory
value, and for which the insurer is liable, that amount must be deducted from the insured value in order to ascertain
what the insurer is liable to contribute.

(2) Where the insurer is liable for salvage charges the extent of his liability must be determined on the like
principle.

[cf. 1906 c. 41 s. 73 U.K.]

Section: 74 Liabilities to third parties 30/06/1997


Where the assured has effected an insurance in express terms against any liability to a third party, the measure of
indemnity, subject to any express provision in the policy, is the amount paid or payable by him to such third party in
respect of such liability.

[cf. 1906 c. 41 s. 74 U.K.]

Section: 75 General provisions as to measure of indemnity 30/06/1997


(1) Where there has been a loss in respect of any subject-matter not expressly provided for in the foregoing
provisions of this Ordinance, the measure of indemnity shall be ascertained, as nearly as may be, in accordance with
those provisions, in so far as applicable to the particular case.

(2) Nothing in the provisions of this Ordinance relating to the measure of indemnity shall affect the rules
relating to double insurance, or prohibit the insurer from disproving interest wholly or in part, or from showing that at
the time of the loss the whole or any part of the subject-matter insured was not at risk under the policy.



Cap 329 - MARINE INSURANCE ORDINANCE 16

[cf. 1906 c. 41 s. 75 U.K.]

Section: 76 Particular average warranties 30/06/1997


(1) Where the subject-matter insured is warranted free from particular average, the assured cannot recover for a
loss of part, other than a loss incurred by a general average sacrifice, unless the contract contained in the policy be
apportionable; but, if the contract be apportionable, the assured may recover for a total loss of any apportionable part.

(2) Where the subject-matter insured is warranted free from particular average, either wholly or under a certain
percentage, the insurer is nevertheless liable for salvage charges, and for particular charges and other expenses
properly incurred pursuant to the provisions of the suing and labouring clause in order to avert a loss insured against.

(3) Unless the policy otherwise provides, where the subject- matter insured is warranted free from particular
average under a specified percentage, a general average loss cannot be added to a particular average loss to make up
the specified percentage.

(4) For the purpose of ascertaining whether the specified percentage has been reached, regard shall be had only
to the actual loss suffered by the subject-matter insured. Particular charges and the expenses of and incidental to
ascertaining and proving the loss must be excluded.

[cf. 1906 c. 41 s. 76 U.K.]

Section: 77 Successive losses 30/06/1997


(1) Unless the policy otherwise provides, and subject to the provisions of this Ordinance, the insurer is liable
for successive losses, even though the total amount of such losses may exceed the sum insured.

(2) Where, under the same policy, a partial loss, which has not been repaired or otherwise made good, is
followed by a total loss, the assured can only recover in respect of the total loss:

Provided that nothing in this section shall affect the liability of the insurer under the suing and labouring clause.
[cf. 1906 c. 41 s. 77 U.K.]


Section: 78 Suing and labouring clause 30/06/1997


(1) Where the policy contains a suing and labouring clause, the engagement thereby entered into is deemed to
be supplementary to the contract of insurance, and the assured may recover from the insurer any expenses properly
incurred pursuant to the clause, notwithstanding that the insurer may have paid for a total loss, or that the subject-
matter may have been warranted free from particular average, either wholly or under a certain percentage.

(2) General average losses and contributions and salvage charges, as defined by this Ordinance, are not
recoverable under the suing and labouring clause.

(3) Expenses incurred for the purpose of averting or diminishing any loss not covered by the policy are not
recoverable under the suing and labouring clause.

(4) It is the duty of the assured and his agents, in all cases, to take such measures as may be reasonable for the
purpose of averting or minimizing a loss.

[cf. 1906 c. 41 s. 78 U.K.]

Section: 79 Right of subrogation 30/06/1997


RIGHTS OF INSURER ON PAYMENT


(1) Where the insurer pays for a total loss, either of the whole, or in the case of goods of any apportionable part,
of the subject-matter insured, he thereupon becomes entitled to take over the interest of the assured in whatever may
remain of the subject- matter so paid for, and he is thereby subrogated to all the rights and remedies of the assured in
and in respect of that subject- matter as from the time of the casualty causing the loss.

(2) Subject to the foregoing provisions, where the insurer pays for a partial loss, he acquires no title to the
subject-matter insured, or such part of it as may remain, but he is thereupon subrogated to all rights and remedies of
the assured in and in respect of the subject-matter insured as from the time of the casualty causing the loss, in so far as
the assured has been indemnified, according to this Ordinance, by such payment for the loss.

[cf. 1906 c. 41 s. 79 U.K.]



Cap 329 - MARINE INSURANCE ORDINANCE 17


Section: 80 Right of contribution 30/06/1997


(1) Where the assured is over-insured by double insurance, each insurer is bound, as between himself and the
other insurers, to contribute rateably to the loss in proportion to the amount for which he is liable under his contract.

(2) If any insurer pays more than his proportion of the loss, he is entitled to maintain an action for contribution
against the other insurers, and is entitled to the like remedies as a surety who has paid more than his proportion of the
debt.

[cf. 1906 c. 41 s. 80 U.K.]

Section: 81 Effect of under insurance 30/06/1997


Where the assured is insured for an amount less than the insurable value or, in the case of a valued policy, for an
amount less than the policy valuation, he is deemed to be his own insurer in respect of the uninsured balance.

[cf. 1906 c. 41 s. 81 U.K.]

Section: 82 Enforcement of return 30/06/1997


RETURN OF PREMIUM


Where the premium or a proportionate part thereof is, by this Ordinance, declared to be returnable-
(a) if already paid, it may be recovered by the assured from the insurer; and
(b) if unpaid, it may be retained by the assured or his agent.

[cf. 1906 c. 41 s. 82 U.K.]

Section: 83 Return by agreement 30/06/1997


Where the policy contains a stipulation for the return of the premium, or a proportionate part thereof, on the
happening of a certain event, and that event happens, the premium, or, as the case may be, the proportionate part
thereof, is thereupon returnable to the assured.

[cf. 1906 c. 41 s. 83 U.K.]

Section: 84 Return for failure of consideration 30/06/1997


(1) Where the consideration for the payment of the premium totally fails, and there has been no fraud or
illegality on the part of the assured or his agents, the premium is thereupon returnable to the assured.

(2) Where the consideration for the payment of the premium is apportionable and there is a total failure of any
apportionable part of the consideration, a proportionate part of the premium is, under the like conditions, thereupon
returnable to the assured.

(3) In particular-
(a) where the policy is void, or is avoided by the insurer as from the commencement of the risk, the

premium is returnable, provided that there has been no fraud or illegality on the part of the assured; but
if the risk is not apportionable, and has once attached, the premium is not returnable;

(b) where the subject-matter insured, or part thereof, has never been imperilled, the premium, or, as the
case may be, a proportionate part thereof, is returnable:

Provided that where the subject-matter has been insured "lost or not lost" and has arrived in
safety at the time when the contract is concluded, the premium is not returnable unless, at such time,
the insurer knew of the safe arrival;

(c) where the assured has no insurable interest throughout the currency of the risk, the premium is
returnable, provided that this rule does not apply to a policy effected by way of gaming or wagering;

(d) where the assured has a defeasible interest which is terminated during the currency of the risk, the
premium is not returnable;

(e) where the assured has over-insured under an unvalued policy, a proportionate part of the premium is
returnable;



Cap 329 - MARINE INSURANCE ORDINANCE 18

(f) subject to the foregoing provisions, where the assured has over-insured by double insurance, a
proportionate part of the several premiums is returnable:

Provided that, if the policies are effected at different times, and any earlier policy has at any time
borne the entire risk, or if a claim has been paid on the policy in respect of the full sum insured
thereby, no premium is returnable in respect of that policy, and when the double insurance is effected
knowingly by the assured no premium is returnable.

[cf. 1906 c. 41 s. 84 U.K.]

Section: 85 Modification of Ordinance in case of mutual insurance 30/06/1997


MUTUAL INSURANCE


(1) Where two or more persons mutually agree to insure each other against marine losses there is said to be a
mutual insurance.

(2) The provisions of this Ordinance relating to the premium do not apply to mutual insurance, but a guarantee,
or such other arrangement as may be agreed upon, may be substituted for the premium.

(3) The provisions of this Ordinance, in so far as they may be modified by the agreement of the parties, may in
the case of mutual insurance be modified by the terms of the policies issued by the association, or by the rules and
regulations of the association.

(4) Subject to the exceptions mentioned in this section, the provisions of this Ordinance apply to a mutual
insurance.

[cf. 1906 c. 41 s. 85 U.K.]

Section: 86 Ratification by assured 30/06/1997


SUPPLEMENTAL


Where a contract of marine insurance is in good faith effected by one person on behalf of another, the person on
whose behalf it is effected may ratify the contract even after he is aware of a loss.

[cf. 1906 c. 41 s. 86 U.K.]

Section: 87 Implied obligations varied by agreement or usage 30/06/1997


(1) Where any right, duty, or liability would arise under a contract of marine insurance by implication of law, it
may be negatived or varied by express agreement, or by usage, if the usage be such as to bind both parties to the
contract.

(2) The provisions of this section extend to any right, duty, or liability declared by this Ordinance which may
be lawfully modified by agreement.

[cf. 1906 c. 41 s. 87 U.K.]

Section: 88 Reasonable time, etc. a question of fact 30/06/1997


Where by this Ordinance any reference is made to reasonable time, reasonable premium, or reasonable diligence,
the question what is reasonable is a question of fact.

[cf. 1906 c. 41 s. 88 U.K.]

Section: 89 Slip as evidence 30/06/1997


Where there is a duly stamped policy, reference may be made, as heretofore, to the slip or covering note, in any
legal proceeding.

[cf. 1906 c. 41 s. 89 U.K.]




Cap 329 - MARINE INSURANCE ORDINANCE 19

Section: 90 Interpretation of terms 30/06/1997


In this Ordinance, unless the context or subject-matter otherwise requires-
"action" (訴訟) includes suit, counter-claim and set-off;
"freight" (運費) includes the profit derivable by a shipowner from the employment of his ship to carry his own goods

or movables, as well as freight payable by a third party, but does not include passage money;
"movables" (動產 ) means any movable tangible property, other than the ship, and includes money, valuable

securities, and other documents; and
"policy" (保單) means a marine policy.

[cf. 1906 c. 41 s. 90 U.K.]

Section: 91 Saving 30/06/1997


The rules of the common law including the law merchant, save in so far as they are inconsistent with the express
provisions of this Ordinance, shall continue to apply to contracts of marine insurance.

[cf. 1906 c. 41 s. 91 U.K.]

Section: 92 Prohibition of gambling on loss by maritime perils L.N. 362 of 1997;

64 of 1999
01/07/1997



Remarks:
Adaptation amendments retroactively made - see 64 of 1999 s. 3


(1) If-
(a) any person effects a contract of marine insurance without having any bona fide interest, direct or

indirect, either in the safe arrival of the ship in relation to which the contract is made or in the safety or
preservation of the subject-matter insured, or a bona fide expectation of acquiring such an interest; or

(b) any person in the employment of the owner of a ship, not being a part owner of the ship, effects a
contract of marine insurance in relation to the ship, and the contract is made "interest or no interest", or
"without further proof of interest than the policy itself", or "without benefit of salvage to the insurer",
or subject to any other like term,

the contract shall be deemed to be a contract by way of gambling on loss by maritime perils, and the person effecting
it shall be guilty of an offence, and shall be liable, on conviction, to imprisonment for a term not exceeding 6 months
or to a fine not exceeding $2000, or to both such fine and imprisonment and in either case to forfeit to the Government
any money he may receive under the contract. (Amended 13 of 1966 Schedule; 64 of 1999 s. 3)

(2) Any broker or other person through whom, and any insurer with whom, any such contract is effected shall
be guilty of an offence and liable on conviction to the like penalties if he acted knowing that the contract was by way
of gambling on loss by maritime perils within the meaning of this section.

(3) Proceedings under this section shall not be instituted without the consent of the Secretary for Justice.
(Amended L.N. 362 of 1997)

(4) Proceedings shall not be instituted under this section against a person (other than a person in the
employment of the owner of the ship in relation to which the contract was made) alleged to have effected a contract by
way of gambling on loss by maritime perils until an opportunity has been afforded him of showing that the contract
was not such a contract as aforesaid, and any information given by that person for that purpose shall not be admissible
in evidence against him in any prosecution under this section.

(5) If proceedings under this section are taken against any person (other than a person in the employment of the
owner of the ship in relation to which the contract was made) for effecting such a contract, and the contract was made
"interest or no interest", or "without further proof of interest than the policy itself", or "without benefit of salvage to
the insurer", or subject to any other like term, the contract shall be deemed to be a contract by way of gambling on loss
by maritime perils unless the contrary is proved.

(6) For the purpose of giving jurisdiction under this section, every offence shall be deemed to have been
committed either in the place in which the same actually was committed or in any place in which the offender may be.

(7) For the purposes of this section the expression "owner" (船東) includes charterer.
(8) Nothing in this section shall affect the operation of section 4.



Cap 329 - MARINE INSURANCE ORDINANCE 20

[cf. 1909 c. 12 s. 1 U.K.]

Schedule: SCHEDULE 30/06/1997


[section 30]


FORM OF POLICY

BE IT KNOWN THAT as well in

own name as for and in the name and names of all and every other person or persons to whom the
same doth, may, or shall appertain, in part or in all doth make assurance and cause
and them, and every of them, to be insured lost or not lost, at and from

Upon any kind of goods and merchandises, and also upon the body, tackle, apparel, ordnance,
munition, artillery, boat, and other furniture, of and in the good ship or vessel called the
whereof is master under God, for this present voyage,
or whosoever else shall go for master in the said ship, or by whatsoever other name or names the
said ship, or the master thereof, is or shall be named or called; beginning the adventure upon the
said goods and merchandises from the loading thereof aboard the said ship,

upon the said ship, etc.

and so shall continue and endure, during her abode there, upon the said ship, etc. And further, until
the said ship, with all her ordnance, tackle, apparel, etc., and goods and merchandises whatsoever
shall be arrived at

upon the said ship, etc., until she hath moored at anchor twenty-four hours in good safety; and upon
the goods and merchandises, until the same be there discharged and safely landed. And it shall be
lawful for the said ship, etc., in this voyage, to proceed and sail to and touch and stay at any ports
or places whatsoever

without prejudice to this insurance. The said ship, etc., goods and merchandises, etc., for so much
as concerns the assured by agreement between the assured and assurers in this policy, are and shall
be valued at


Touching the adventures and perils which we the assurers are contented to bear and do take
upon us in this voyage: they are of the seas, men of war, fire, enemies, pirates, rovers, thieves,
jettisons, letters of mart and countermart, surprisals, takings at sea, arrests, restraints, and
detainments of all kings, princes, and people, of what nation, condition, or quality soever, barratry
of the master and mariners, and of all other perils, losses, and misfortunes, that have or shall come
to the hurt, detriment, or damage of the said goods and merchandises, and ship, etc., or any part
thereof. And in case of any loss or misfortune it shall be lawful to the assured, their factors,
servants and assigns, to sue, labour, and travel for, in and about the defence, safeguards, and
recovery of the said goods and merchandises, and ship, etc., or any part thereof, without prejudice
to this insurance; to the charges whereof we, the assurers, will contribute each one according to the
rate and quantity of his sum herein assured. And it is especially declared and agreed that no acts of
the insurer or insured in recovering, saving, or preserving the property insured shall be considered
as a waiver, or acceptance of abandonment. And it is agreed by us, the insurers, that this writing or
policy of assurance shall be of as much force and effect as the surest writing or policy of assurance
heretofore made in Lombard Street, or in the Royal Exchange, or elsewhere in London. And so we,
the assurers, are contented, and do hereby promise and bind ourselves, each one for his own part,
our heirs, executors, and goods to the assured, their executors, administrators, and assigns, for the
true performance of the premises, confessing ourselves paid the consideration due unto us for this
assurance by the assured, at and after the rate of

Lloyd's S.G. Policy.









































(Sue and labour
clause).




(Waiver clause).











Cap 329 - MARINE INSURANCE ORDINANCE 21


IN WITNESS whereof we, the assurers, have subscribed our names and sums assured in

London.


N.B.-Corn, fish, salt, fruit, flour, and seed are warranted free from average, unless general, or
the ship be stranded-sugar, tobacco, hemp, flax, hides and skins are warranted free from average,
under five pounds per cent, and all other goods, also the ship and freight, are warranted free from
average, under three pounds per cent unless general, or the ship be stranded.









(Memorandum).


RULES FOR CONSTRUCTION OF POLICY


The following are the rules referred to by this Ordinance for the construction of a policy in the

above or other like form, where the context does not otherwise require-

1. Lost or not lost

Where the subject-matter is insured "lost or not lost", and the loss has occurred before the
contract is concluded, the risk attaches unless, at such time the assured was aware of the loss, and
the insurer was not.

2. From

Where the subject-matter is insured "from" a particular place, the risk does not attach until the
ship starts on the voyage insured.

3. At and from

(1) Where a ship is insured "at and from" a particular place, and she is at that place in good
safety when the contract is concluded, the risk attaches immediately.

(2) If she be not at that place when the contract is concluded, the risk attaches as soon as she
arrives there in good safety, and, unless the policy otherwise provides, it is immaterial that she is
covered by another policy for a specified time after arrival.

(3) Where chartered freight is insured "at and from" a particular place, and the ship is at that
place in good safety when the contract is concluded the risk attaches immediately. If she be not
there when the contract is concluded, the risk attaches as soon as she arrives there in good safety.

(4) Where freight, other than chartered freight, is payable without special conditions and is
insured "at and from" a particular place, the risk attaches pro rata as the goods or merchandise are
shipped; provided that if there be cargo in readiness which belongs to the shipowner, or which
some other person has contracted with him to ship, the risk attaches as soon as the ship is ready to
receive such cargo.

4. From the loading thereof

Where goods or other movables are insured "from the loading thereof", the risk does not attach
until such goods or movable are actually on board, and the insurer is not liable for them while in
transit from the shore to the ship.

5. Safely landed

Where the risk on goods or other movables continues until they are "safely landed", they must
be landed in the customary manner and within a reasonable time after arrival at the port of
discharge, and if they are not so landed the risk ceases.

6. Touch and stay

In the absence of any further licence or usage, the liberty to touch and stay "at any port or place
whatsoever" does not authorize the ship to depart from the course of her voyage from the port of
departure to the port of destination.

7. Perils of the seas

The term "perils of the seas" (海險) refers only to fortuitous accidents or casualties of the seas.


















(ship).







(Freight).



Cap 329 - MARINE INSURANCE ORDINANCE 22

It does not include the ordinary action of the winds and waves.

8. Pirates

The term "pirates" (海盜) includes passengers who mutiny and rioters who attack the ship
from the shore.

9. Thieves

The term "thieves" (盜竊) does not cover clandestine theft or a theft committed by any one of
the ship's company, whether crew or passengers.

10. Restraint of princes

The term "arrests, etc., of kings, princes, and people" (君王、君主及人民所作的拘禁等)
refers to political or executive acts, and does not include a loss caused by riot or by ordinary
judicial process.

11. Barratry

The term "barratry" (船上人員不當行為) includes every wrongful act wilfully committed by
the master or crew to the prejudice of the owner, or, as the case may be, the charterer.

12. All other perils

The term "all other perils"(一切其他類同危險) includes only perils similar in kind to the
perils specifically mentioned in the policy.

13. Average unless general

The term "average unless general" (除非是共同海損的海損) means a partial loss of the
subject-matter insured other than a general average loss, and does not include "particular charges"
(單獨費用).

14. Stranded

Where the ship has stranded, the insurer is liable for the excepted losses, although the loss is
not attributable to the stranding, provided that when the stranding takes place the risk has attached
and, if the policy be on goods, that the damaged goods are on board.

15. Ship

The "ship" (船舶) includes the hull, materials and outfit, stores and provisions for the officers
and crew, and, in the case of vessels engaged in a special trade, the ordinary fittings requisite for
the trade, and also, in the case of a steamship, the machinery, boilers, and coals and engine stores,
if owned by the assured.

16. Freight

The term "freight" (運費)includes the profit derivable by a shipowner from the employment of
his ship to carry his own goods or movables, as well as freight payable by a third party, but does
not include passage money.

17. Goods

The term "goods" (貨品) means goods in the nature of merchandise, and does not include
personal effects or provisions and stores for use on board. In the absence of any usage to the
contrary, deck cargo and living animals must be insured specifically, and not under the general
denomination of goods.

[cf. 1906 c. 41 First Schedule U.K.]