Diversity in Marine Insurance

The Late Sanjeev Bhandari was a doyen of the Marine Insurance field in India. Late Sanjeev Bhandari left for his heavenly abode on 04^th Jan 2017 and is sorely missed by all. He was a source of wisdom, knowledge, inspiration, and goodwill to not only many in India but also worldwide. He enlightened all in marine insurance law, shipping contracts and more. He is fondly remembered for his strength of character, his unbiased mediation and arbitration skills, his mature thinking and calm disposition. To rejoice his life and memories, AMICIE organized the Sanjeev Bhandari Memorial Marine Insurance Webinar on 07^th May 2022 in which the undersigned was one of the speakers. My below article was basically our response to the question put forth during the webinar as to whether the market should react to the changing center of economic activity given that Marine Insurance is seen as a British or European in nature.

1. I met Sanjeev Bhandari at Chennai twice – once when he had come to Chennai as an arbitrator, and I was in town and later at a seminar conducted by the ICS East India Branch in March 2016. He was a thorough gentlemen, consummate professional who was happy to guide “youngsters” like me. I had hoped that I would learn more from his guidance but sadly, he was taken away from us too early. Sanjeev was not only respected in India but also overseas and which spoke volumes of his professionalism.
2. Moving on to the topic, while the Insurance industry is truly global but more needs to be done for “Diversity”. Let me expand this further
   1. To illustrate this, I recalled Romesh Ranganathan comment on being a Coconut – Brown Outside and White Inside and this resonates with me. For those of you who do not know Romesh, he is a British comedian of Sri Lankan Tamil Origin and who gives his shows in English. He is available in YouTube and if you have time for a good laugh, you may wish to hear him.
   2. I also recently came across the fantastic article of Lucy Greenwood, a renowned arbitrator, on “How to never get an (other) arbitral appointment” which is a fantastic read for those wanting to be involved in arbitration. In particular, she mentions the benefit of diversity leading to better decisions in arbitrations and which is something I believe something strongly in. I believe her message on Diversity should also hold good for other professions too.
   3. So how does this all lead to Marine Insurance Industry. Given that the attendees are mainly from India/UK or other commonwealth jurisdictions, our focus has been primarily on the English Law including the Marine Insurance Act 1906. This sometimes clouds our thought process in our understanding in this complex field.
   4. Take for example Proximate Cause – in the English System, if loss is caused proximately by an included and excluded peril, then there is no cover due to the exclusions trumping the positive cover available. However, the application of say the Maritime Code of PR of China would actually result in some cover being available to the Insured on the basis of proportional liability (see the paper by Liang Zhao published at Cambridge University Press and NUS).
   5. Let us say consider the Hull policies. English policies are on Named Perils whereas the Nordic Plan is on an “All Risks” basis. While the addition of Additional Perils Clause to the English Policies may arguably result in an “All Risks” cover, it is not quite so. In a named perils policy, the Insured must prove that the loss arose from one of the perils listed in the policy. However, in the case of an All-Risks policy everything is covered unless the Insurers are able to prove that the loss arose out of one of the exclusions listed in the policy.
   6. The fact is that every jurisdiction will try to promote itself as the best jurisdiction. However, promoting and being the best are actually two different things. This being the case, at the very least, an user should be aware of the offerings, the pros and cons and make an informed choice. This would only be possible if users either have the particular expertise or engage professionals who are able to guide them effectively. This necessarily means that Users should consider all the offerings (this is where diversity comes in).
   7. The way to deal with this is to ensure diversity. Diversity for me in Marine Insurance would therefore be on
      • Insurance Cover
      • Laws
      • Jurisdiction
      • Insurers
      • Lawyers/Consultants/Correspondents/Adjusters
      • Claims handlers
      • Dispute Resolution Process

I believe that Proper Diversity will develop the Marine Insurance field further to satisfy the users. This will also force jurisdictions to get their act going (for instance, the English Insurance Act 2015 and Enterprise Act 2016 were perhaps legislated due to competition from other jurisdictions)

.