Abandonment is a particular method of indemnification that allows the insured to receive the total insured value by abandoning the insurance thing to the insurer. The insurer is under no obligation to accept abandonment.
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Yachting
It is the navigation carried out for a purely sporting or recreational purpose, that is, non-profit. Recreational vessels can be divided into three categories:
– vessels for personal use used privately by the owner, a tenant who has complete disposal or a borrower free of charge, for tourist or sporting navigation;
– training vessels used as part of the activities of a training center aimed at obtaining the titles allowing the conduct of pleasure craft;
– ships for collective use not falling within the definition of a passenger ship, on which may embark for a fee, under the owner’s responsibility, his representative or his employee, himself embarked, persons, carrying out navigation tourism or sports.
Occurrence
The occurrence is an English term that designates the accident or the unanticipated event that triggers the aviation insurers’ guarantee.
It is distinguished from the generating event, which is not an event, but which may be negligence causing damage or an accident.
Coinsurance
Technique by which several insurance companies will guarantee the same risk through the same contract to limit the consequences. Coinsurance, therefore, allows the horizontal sharing of risks between several insurance companies. In the event of a claim, the principle of coinsurance enables the companies concerned to meet the reimbursements provided for without jeopardizing their financial health. The coinsurance technique should not confuse with that of reinsurance.
Protection and Indemnity Club
Protection & Indemnity Clubs (P and I) are mutual insurance companies that protect their members.
The P and I open the civil liability of shipowners, owners, or charterers. They operate like true mutuals, i.e., in the event of insufficient assets to cover the loss. Thus, they make calls (cash calls) to their members, who may require to honor them.
Agreed value (sea or land)
In the maritime sector, the agreed value is that of all the material elements of the ship or aircraft set contractually by the insurer and the insured. In a total loss, the insurer pays the contractually approved value. This may be higher than the strictly market value of the property.
Inland transport, the principles of the agreed value are subject to article L. 121-1 of the insurance code of public order. Thus, Insurers and insureds set an agreed value in the contract. So, This will only come into play if the property’s market value is higher than the agreed value. In this case, the insurer pays only the agreed amount.