Hi Celia

Welcome to our latest edition of The Navigator, Vero Marine's industry communication.

In this issue, we highlight the change to the New Zealand Carriage of Goods Act 1979.  We talk about some interesting things you may not be aware of and their effect on marine insurance, update you on the progress we have made with electronic documentation delivery, consider what marine cargo cover would apply if the USA and North Korea went to war and provide some pointers on cargo policy limits.

Finally, we have included another interesting term from 'All Hands and the Cook'

Changes to the New Zealand Carriage of Goods Act 1979

On 1 September 2017, the New Zealand Carriage of Goods Act 1979 (and amendments) will be repealed and replaced by Part 5, Subpart 1 of the Contract and Commercial Law Act 2017.

Electronic delivery of documentation update

In the March edition of The Navigator we gave you a heads-up about our plan to roll out electronic delivery or documentation.  Less than a week later our first renewal run went out leaving a few brokers rather perplexed at the unusual hours our underwriters seemed to be working.  This was the beginning of our implementation of electronic documentation delivery.

Things you may not know

• USA's Jones Act 1920
• Increasing submarine numbers in the South China Sea
• Larger TEU container vessels
• Autonomous ships
• USA stance on climate change

What marine cargo insurance protection is there if war breaks out between the USA and North Korea?

There are two answers to this question, depending on whether the conflict is nuclear or conventional. (As to what the USA’s options might be with North Korea, a place to start is this article in The Atlantic).

It’s important to realise that, ever since the first effective aerial bombing during the Spanish Civil War in the 1930s, the world’s main marine reinsurance markets, London in particular, have not insured war risk on land. The Waterborne Agreement was signed in 1936. With very few limited exceptions (in the main to do with transhipments, and ports of refuge), cargo is only insured for war risks whilst it is afloat. The current position is set out in a long and convoluted Duration Clause 5 of the Institute War Clauses (Cargo) 01/01/2009.

Setting the correct cargo policy limit

One of the more memorable moments in our last internal Suncorp corporate audit was when an auditor asked: “If this is the Bottom Limit, what’s the Top Limit?” We took some delight in nonchalantly assuring him that they were the same thing.

A Bottom Limit is an archaic marine insurance term that refers to a ship’s bottom, or hull. In translation: it is the maximum amount of cargo that is insured per ship. Often, perhaps to spare more confusion, we now refer to this as the Conveyance Limit, as this also allows for land and air cargo.

Read more for some points you should consider when requesting or reviewing a Cargo Conveyance Limit