CMFAS CGI Marine Cargo & Hull Insurance question: insurable interest in marine CARGO

CMFAS CGIMarine Cargo & Hull Insurance

Regarding insurable interest in marine CARGO, which statement is correct?

A The insured must always hold interest at the exact moment the policy is effected, or the cover is void
B Insurable interest is never required for cargo cover to be valid, only for hull cover
C Interest need not exist when the policy is effected, provided it is acquired by the time of loss
D Interest may still be acquired after the insured already knows that the loss has occurred

Show the answer and explanation

Answer: C. Interest need not exist when the policy is effected, provided it is acquired by the time of loss

Marine cargo has a special timing rule: the insured need not have interest when the policy is effected provided interest is acquired before or at the time of loss (but not after they know a loss has occurred).

Common mistake

Applying the ordinary property rule (interest at time of loss and at inception) instead of the marine cargo flexibility.

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CMFAS CGI Marine Cargo & Hull Insurance question: insurable interest in marine CARGO

Answer: C. Interest need not exist when the policy is effected, provided it is acquired by the time of loss

Common mistake

Related CMFAS CGI questions

CMFAS CGI Marine Cargo & Hull Insurance question: insurable interest in marine CARGO

Answer: C. Interest need not exist when the policy is effected, provided it is acquired by the time of loss

Common mistake

Related CMFAS CGI questions