Complete Glossary of
Marine Terms & Abbreviations
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Valuation Clause
Provides the basis for determining the insured value of a shipment under the Open Cargo policy.
Valued Bill of Lading
A bill of lading issued by the carrier which indicates the amount which the shipper has declared as the value of the merchandise. The carrier will be liable for this amount in the event he is found responsible for loss or damage to the merchandise.
Valued Policies
A marine policy may be valued or unvalued.
A valued policy is one which specified the value, usually with the words "valued at" or "so valued". The value in a valued policy is agreed at inception and, in the absence of fraud, is conclusive as between the insurer and assured, irrespective of whether or not it is the true value. It may only be reopened in the case of fraud or of gross over-valuation of cargo. In practice cargo policies are always valued because an unvalued policy is subject to the measure of indemnity and the valuation provisions laid down by the Marine Insurance Act, 1906, whereby the assured cannot include the profit earned by the sale of the goods. This places him in a position as though the adventure had never commenced.
A valued policy allows the assured to include the profit so that in the event of loss he is placed in the position as though the adventure had been completed. In hull insurance a valued policy is used because an old vessel is as valuable a freight earner to the assured as a relatively new vessel. For this reason, the assured wishes to insure for an amount which bears some relation to the vessel’s true value to him rather than its market value. A valued policy enables him to do this. such a valuation is acceptable to insurers, particularly as partial losses are payable in full under a valued hull policy, without reference to the true value, and over-valuation of this nature tends to increase the premium income to cover such partial losses.
VAT
Value added tax
Vice Propre
Means Inherent vice.
Voidable Policy
Where the underwriter has the right to avoid a policy (e.g., in the event of a breach of good faith), the policy is termed "voidable."
Voyage Charter
The shipowner hires out his vessel, subject to various conditions, for the carriage of cargo for a single voyage.