chapter  2
1 Pages

Excess Liabilities

When considering the standard clauses for the insurance of ships under the Institute Time Clauses, Hulls, 1/10/83 and 1/11/95, we observed that general average, salvage and sue and labour charges were all subject to reduction in the event of underinsurance and collision liabilities are limited to three-fourths of the insured or insurable value. It therefore became common practice for shipowners to take out supplementary insurances on ‘‘excess liabilities’’ to enable them, in the event of the ship being under-valued on the hull policy, to obtain further coverage for the excess of any specific contribution or liability over and above the amount recoverable under the hull policy.