MARINE INSURANCE is one of the most primitive forms of any insurance arrangements

on earth. Greeks and Romans were the primary civilizations who were in the habit of
guarding themselves against some of the risks of maritime enterprises in the shape of loans or
mutual guarantee for man-made perils.1 The sea is a vast area covering hundreds and
thousands of miles where and there are numerous risks involved during a voyage; some of
them foreseen and the rest unforeseen. Two of the most established risks which the insurers
as well as the insured are well are:

1. PIRACY
2. MAN OF WAR

Both the maritime perils are insured perils which come under the ambit of a standard
insurance policy. Both the perils involve the role of human beings which implies nature has
no role to play. Therefore, the ship owners as well as the insurance companies will analyse
the risk involved during a voyage.

PIRACY

The perils caused by pirates, rovers and thieves were common in olden times. In these days
they are considerably reduced. These acts have been committed for the pursuit of personal
gain. English law defines piracy as “violence or depredation on the high seas or in the air,
for private ends, using aircraft or vessels or boats.” There is an immediate harm caused to
the ships and the pirates have no state jurisdiction. It is a measurable risk which the ship
owners have to take into consideration and insurance can be availed proportionate to the loss
which is caused.

PIRACY UNDER UNITED KINGDOM LAW AND INDIAN LAWS

The Privy Council of the United Kingdom in Re Piracy Jure Gentium expressed the view
that actual robbery is not an essential element in the crime of piracy jure gentium and that a
frustrated attempt to commit piratical robbery is equally piracy jure gentium.2

1
Frederick Martin, “The History of Lloyd’s and of Marine Insurance in Great Britain with an Appendix
containing statistics relating to marine insurance” (Macmillan and Co 1876) 2

2
(1934) AC 586, 600 (PC).
The risk of piracy is defined in RULE 8 OF THE RULES FOR CONSTRUCTION that
this term ‘includes passengers who mutiny and rioters who attack the ship from the shore’.
This is unlikely to fit in well within the modern context where attacks from pirates are
unlikely to be from the ‘shore’.3 Also, how far from the shore can a ship be attacked is a
matter of great concern.

It must also be noted that the definition of the ‘piracy’ in Rule 8 is not the same as that in the
context of the United Nations Convention on the Law of the Sea (UNCLOS) 1994 where
it is committed (a) against a ship, aircraft, persons or property in a place outside the
jurisdiction of any State; (b) any act of voluntary participation in the operation of a ship or of
an aircraft with knowledge of facts making it a pirate ship or aircraft;

The Indian Marine Insurance Act, 1963 also has mentioned ‘piracy’ as an insured maritime
peril under section 2(e) of Marine Insurance Act, 1963 as well as section 3(2) (c) of
Marine Insurance Act, 1906.

CASE LAW: BOLIVIA V INDEMNITY MUTUAL MARINE ASSURANCE4

In this case, a vessel was taken by a group of men who attempted to establish the ‘Free
Republic of El Acre’ in a once disputed area between Brazil and Bolivia. All of the judges in
the Court of Appeal endorsed the speech of Pickford J at first instance where there the pirate
was described as ‘a man who is plundering indiscriminately for his own ends, and not a man
who is simply operating against the property of a particular State for the public end’.
Therefore, it is the motive for the ‘private ends’ which distinguishes the piracy risk from the
risk of terrorism.

CASE LAW: THE ANDREAS LEMOS CASE5

In addition to the argument on the risk of theft, the argument on the risk of piracy was also
raised in this particular case. In reliance on public international law, the counsel for the
underwriters argued that the situation did not constitute piracy as it happened on territorial
waters.

3
Poomintr Sooksripaisarnkit (n 515), 278.
4
[1909] 1 KB 785
5
The Andreas Lemos [1982] 2 Lloyd's Rep. 283
Therefore the court underlined that any piracy activity carried out in the territorial waters of a
nation must be investigated by the nation itself by applying global treaties as well as
conventions.

MAN OF WAR

‘Man of War’ is the vessel which has been authorised by nations for the purpose of defence
or attack in times of hostilities. Any damage to the goods or ships arising out of collision
against a man of war is insurable. It includes naval vessels, aircraft carries, and frigates etc.
which are owned by the state for defence purposes. This principle is applicable during war
time and thus a cargo ship or a civilian ship is insured during a situation of war between
nations as the particular ship has free way of passage.

‘MAN OF WAR’ UNDER BRITISH AND INDIAN LAWS

The British courts adhere to a principle called as the principle of ‘reasonable person’ under
the Marine Insurance Act, 1906 where during war time, all the ships for civilian purposes
must be allowed free passage if it does not pose any imminent threat to the security of the
nations. At times when the naval vessels cause any damage to the cargo vessel, then the state
is liable to pay damages to the insured company.

The Indian Insurance Act, 1963 does not specifically mention the principle of ‘Man of War’
but the Indian courts tend to follow the British judgments so as to decide on cases where any
damage is caused to any unarmed civilian vessel by the acts of a military ship during war
time.

CASE LAW: YORKSHIRE DALE STEAMSHIP CO LTD V MINISTER OF WAR

TRANSPORT, 19426

It is a landmark case in British law where the courts have defined how the judiciary must
respond to cases where a civilian ship is damaged by a naval ship (‘man of war’) during war
time. In the following case, a civilian ship was damaged after colliding with HMS Queen
Elizabeth, a British naval vessel during an operation.

6
https://swarb.co.uk/yorkshire-dale-steamship-co-ltd-v-minister-of-war-transport-hl-1942/
The courts held the naval ship as well as the state liable and Justice Smith used the term ‘Man
of War’ to describe how the insurance companies as well as the insured can claim damages
during such acts.
 REFERENCES

 BOOKS
1. K.S.N.Murthy & Dr. K.V.S.Sarma, “Modern Law of Insurance in India”
(4th ed. 1995) (Lexis Nexis Butterworths India, New Delhi) at page 150.
2. Brij Nandan Singh, “A comprehensive treatise on Law of Insurance,
Covering all risks except marine insurance” (3rd ed.1993) (The
University Book Agency, Allahabad) at page 17.\
3. P.S. Madhyastha, Legal Aspects of Life Insurance, (Reprint August
2006)( Insurance Institute of India. Mumbai) at page 61.

 ARTICLES
1. J.R. Archana, “A CRITICAL STUDY ON PERILS OF THE SEA UNDER
MARINE INSURANCE”, VOLUME I, ISSUE 3 | ISSN: 2456-3595,
International Journal of Legal Insight.