Both-To-Blame Collision Clause

AAA

DEFINITION of 'Both-To-Blame Collision Clause'

Part of the Ocean Marine Insurance policy that states that if a ship (vessel) collides with another ship due to the negligence of both, owners and shippers of both vessels must share in the losses in accordance with the monetary values of their cargo and interests before the collision. The owners of the cargo and company responsible for shipment are both required to pay for losses.



INVESTOPEDIA EXPLAINS 'Both-To-Blame Collision Clause'

As globalization grows, the shipping industry also grows. In the event of a collision the company's liabilities, and thus risk, will be limited with ocean marine insurance. An Ocean Marine Insurance provides coverage against losses for ships. It provides protection in the event of damage or destruction of a ship's hull and/or the ship's freight.


Some protections also provided under this insurance include:
- Collision of the ship with another ship or object
- A ship sinking, capsizing, or being stranded
- Fire, piracy, jettisoning (throwing overboard of property to save other property)
- Barratry (fraud or an illegal act by a ship's master or crew)


Damage due to wear and tear, dampness, decay, mold and war are not included in the coverage.

RELATED TERMS
  1. Insurance Proceeds

    The benefit proceeds paid out by any type of insurance policy ...
  2. Premium

    1. The total cost of an option. 2. The difference between the ...
  3. Insurance

    A contract (policy) in which an individual or entity receives ...
  4. Actuarial Risk

    The risk that the assumptions that actuaries implement into a ...
  5. Insurance Underwriter

    A financial professional that evaluates the risks of insuring ...
  6. Future Purchase Option

    A feature of long-term disability insurance that allows policyholders ...
Related Articles
  1. Understanding Your Insurance Contract
    Insurance

    Understanding Your Insurance Contract

  2. The History Of Insurance
    Home & Auto

    The History Of Insurance

  3. Insurance Coverage: A Business Necessity
    Entrepreneurship

    Insurance Coverage: A Business Necessity

  4. The Basics Of Travel Insurance
    Insurance

    The Basics Of Travel Insurance

Hot Definitions
  1. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  2. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  3. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  4. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
  5. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
  6. Accelerated Depreciation

    Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years ...
Trading Center