The Short Title of this Act is the Marine Insurance Act 1908.

This Act is a consolidation of the enactments mentioned in Schedule 1.

All matters and proceedings commenced under those enactments, and pending or in progress on the coming into operation of this Act, may be continued, completed, and enforced under this Act.

In this Act, if not inconsistent with the context,—

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.

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.

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 Act, in so far as applicable, shall apply thereto; but, except as provided by this section, nothing in this Act shall alter or affect any rule of law applicable to any contract of insurance other than a contract of marine insurance as defined by this Act.

Subject to the provisions of this Act, every lawful marine adventure may be the subject of a contract of marine insurance.

In particular there is a marine adventure where—

Maritime perils 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 designated by the policy.

Every contract of marine insurance by way of gaming or wagering is void.

A contract of marine insurance is deemed to be a gaming or wagering contract—

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

In particular a person is interested in a marine adventure where he or she stands in any legal or equitable relation to the adventure, or to any insurable property at risk therein, in consequence of which he or she 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.

The assured must be interested in the subject matter insured at the time of the loss, though he or she need not be interested when the insurance is effected:

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

A defeasible interest is insurable, as also is a contingent interest.

In particular, where the buyer of goods has insured them he or she has an insurable interest, notwithstanding that he or she might at his or her 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.

A partial interest of any nature is insurable.

The insurer under a contract of marine insurance has an insurable interest in his or her risk, and may reinsure in respect of it.

Unless the policy otherwise provides, the original assured has no right or interest in respect of such reinsurance.

The lender of money on bottomry or respondentia has an insurable interest in respect of the loan.

The master or any member of the crew of a ship has an insurable interest in respect of his or her wages.

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.

The assured has an insurable interest in the charges of any insurance which he or she may effect.

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.

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 or her own benefit.

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 or her in case of loss.

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

The provisions of this section do not affect a transmission of interest by operation of law.

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

Subject to the provisions of this section, the assured must disclose to the insurer, before the contract is concluded, every material circumstance 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 or her. If the assured fails to make such disclosure, the insurer may avoid the contract.

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

In the absence of inquiry the following circumstances need not be disclosed, namely:

Whether any particular circumstance which is not disclosed is material or not is in each case a question of fact.

The term circumstance includes any communication made to or information received by the assured.

Subject to the provisions of the last preceding section 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—

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

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

A representation may be either a representation as to a matter of fact or as to a matter of expectation or belief.

A representation as to a matter of fact is true if it is 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.

A representation as to a matter of expectation or belief is true if it is made in good faith.

A representation may be withdrawn or corrected before the contract is concluded.

Whether a particular representation is material or not is in each case a question of fact.

A contract of marine insurance is deemed to be concluded when the proposal of the assured is accepted by the insurer, whether the policy is 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, although it is unstamped.

A marine policy must specify—

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.

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

The subject matter insured must be designated in a marine policy with reasonable certainty.

The nature and extent of the interest of the assured in the subject matter insured need not be specified in the policy.

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.

In the application of this section regard shall be had to any usage regulating the designation of the subject matter insured.

Every person commits an offence and is liable on conviction to a fine not exceeding $200 who, as an insurer or as the agent of an insurer, directly or indirectly receives or takes credit in account for any premium or consideration for any contract of marine insurance, and does not before or within 30 days after receiving or taking credit for such premium or consideration duly execute, or procure to be duly executed, a policy of such insurance complying with the provisions of this Act.

This section does not apply to contracts of reinsurance of risks.

This section applies to the agent of an insurer, whether such insurer resides or carries on business in New Zealand or elsewhere.

Failure to comply with any of the provisions of sections 23 to 26 shall not of itself invalidate any contract of marine insurance.

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.

A policy may be either valued or unvalued.

A valued policy is a policy which specifies the agreed value of the subject matter insured.

Subject to the provisions of this Act, 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 is total or partial.

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.

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.

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.

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

Unless the policy otherwise provides, the declarations must be made in the order of despatch 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.

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.

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

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.

Subject to the provisions of this Act, and unless the context of the policy otherwise requires, the terms and expressions mentioned in Schedule 2 have, when contained in a policy, the meaning and operation attributed to them in the said schedule.

Where 2 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 Act, the assured is said to be overinsured by double insurance.

Where the assured is overinsured by double insurance—

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 be done, or that some condition shall be fulfilled, or whereby he or she affirms or negatives the existence of a particular state of facts.

A warranty may be express or implied.

A warranty as above defined is a condition which must be exactly complied with, whether material to the risk or not. If it is 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 or her before that date.

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.

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

A breach of warranty may be waived by the insurer.

An express warranty may be in any form of words from which the intention to warrant is to be inferred.

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.

An express warranty does not exclude an implied warranty, unless it is inconsistent therewith.

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.

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

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

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

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.

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.

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.

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.

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.

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

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.

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.

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 is not so commenced the insurer may avoid the contract.

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 that he or she waived the condition.

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.

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.

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.

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.

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.

There is a deviation from the voyage contemplated by the policy—

The intention to deviate is immaterial; there must be a deviation in fact to discharge the insurer from his or her liability under the contract.

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.

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.

In the case of a voyage policy the adventure insured must be prosecuted throughout its course with reasonable despatch, 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.

Deviation or delay in prosecuting the voyage contemplated by the policy is excused—

When the cause excusing the deviation or delay ceases to operate, the ship must resume her course and prosecute her voyage with reasonable despatch.

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

Where a marine policy has been assigned so as to pass the beneficial interest in the policy, the assignee of the policy is entitled to sue thereon in his or her own name; and the defendant is entitled to make any defence arising out of the contract which he or she 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.

A marine policy may be assigned by indorsement thereon or in other customary manner.

Where the assured has parted with or lost his or her 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:

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.

Unless otherwise agreed, the broker has, as against the assured, a lien upon the policy for the amount of the premium and his or her charges in respect of effecting the policy; and, where he or she has dealt with the person who employs him or her as a principal, he or she has also a lien on the policy in respect of any balance on any insurance account which may be due to him or her from such person, unless when the debt was incurred he or she had reason to believe that such person was only an agent.

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 the broker.

Subject to the provisions of this Act, 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 or she is not liable for any loss not proximately caused by a peril insured against.

In particular—

A loss may be either total or partial. Any loss other than a total loss, as hereinafter defined, is a partial loss.

A total loss may be either an actual total loss or a constructive total loss.

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.

Where the assured brings an action for a total loss, and the evidence proves only a partial loss, he or she may, unless the policy otherwise provides, recover for a partial loss.

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.

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.

In the case of an actual total loss no notice of abandonment need be given.

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.

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 reshipping 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.

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.

In particular there is a constructive total loss—

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.

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.

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

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 or her insured interest in the subject matter insured unconditionally to the insurer.

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.

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.

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.

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.

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 or her.

Notice of abandonment may be waived by the insurer.

Where an insurer has reinsured his or her risk, no notice of abandonment need be given by him or her.

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.

Upon the abandonment of a ship the insurer thereof is entitled to any freight which is 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.

A particular average loss is a partial loss of the subject matter insured, which is caused by a peril insured against, and which is not a general average loss.

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.

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.

Salvage charges means the charges recoverable under maritime law by a salvor independently of contract, and does not include the expenses of services in the nature of salvage rendered by the assured or his or her 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.

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.

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.

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.

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

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 or she may recover therefor from the insurer.

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.

Where ship, freight, and cargo, or any 2 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.

The sum which the assured can recover in respect of a loss on a policy by which he or she 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.

Where there is a loss recoverable under the policy, the insurer, or each insurer if there are more than 1, is liable for such proportion of the measure of indemnity as the amount of his or her 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.

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

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:

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.

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:

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 Act.

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.

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 is not insured for its full contributory value, or if only part of it is 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.

Where the insurer is liable for salvage charges, the extent of his or her liability must be determined on the like principle.

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 or her to such third party in respect of such liability.

Where there has been a loss in respect of any subject matter not expressly provided for in the foregoing provisions of this Act, 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.

Nothing in the provisions of this Act 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.

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 is apportionable; but if the contract is apportionable, the assured may recover for a total loss of any apportionable part.

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.

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.

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.

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

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.

Nothing in this section shall affect the liability of the insurer under the suing and labouring clause.

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.

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

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.

It is the duty of the assured and his or her agents in all cases to take such measures as may be reasonable for the purpose of averting or minimising a loss.

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 or she thereupon becomes entitled to take over the interest of the assured in whatever may remain of the subject matter so paid for, and he or she 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.

Subject to the foregoing provisions, where the insurer pays for a partial loss he or she acquires no title to the subject matter insured, or such part of it as may remain, but he or she 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 Act, by such payment for the loss.

Where the assured is overinsured by double insurance, each insurer is bound, as between himself or herself and the other insurers, to contribute rateably to the loss in proportion to the amount for which he or she is liable under his or her contract.

If any insurer pays more than his or her proportion of the loss, he or she 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 or her proportion of the debt.

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 or she is deemed to be his or her own insurer in respect of the uninsured balance.

Where the premium or a proportionate part thereof is by this Act declared to be returnable,—

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.

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 or her agents, the premium is thereupon returnable to the assured.

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.

In particular,—

Where 2 or more persons mutually agree to insure each other against marine losses there is said to be a mutual insurance.

The provisions of this Act 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.

The provisions of this Act, 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.

Subject to the exceptions mentioned in this section, the provisions of this Act apply to a mutual insurance.

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 or she is aware of the loss.

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.

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

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

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