Sec 5 of MI Act 1963
- Lawful marine adventure : Subject to
the provisions of this Act, every lawful marine adventure may be the subject of
a contract of marine insurance
Sec 43 of MI Act 1963
- Warranty of legality.—There is an implied warranty that the adventure insured
is a lawful one, and that, so far as the assured can control the matter, the
adventure shall be carried out in a lawful manner.
There was a time when one
would find small children cleaning the food table and doing other sundry work
in hotels – now in most establishments we see a board ‘No Child labour’ –
because of the law banning employment of children in eateries. When you order
food, or buy food from any famous branded outlet, can one seek to know that ‘no
children were employed in producing or in manner’. Ever heard of a clause in Marine Insurance
policy designed to keep the products of modern slavery out of the export supply
chain. Understand that such clause has been introduced in London market ! My understanding
of this clause is that it is not directly connected to ‘slave trade’ and dark days when human slaves were insured as cargo.
pic
of illegal boat migrants
Burnley
Football Club is an English association football club based in Burnley,
Lancashire. Founded on 18 May 1882, it was one of the first to become
professional (in 1883) and now competes in the Premier League, the top tier of
English football. Burnley was in
news for wrong reasons a banner reading "White Lives Matter
Burnley" was towed by an aeroplane
over Etihad Stadium during Monday's match against Manchester City. The aircraft
circled over the stadium just after kick-off in City's 5-0 win. Burnley and
City players and staff had taken a knee in support of the Black Lives Matter
movement moments earlier. The incident
“caused offence to many people in Lancashire and beyond”, a Police officer said on Tuesday, as the stunt was
blamed on individuals from a group of football hooligans connected with
Burnley. However, Lancashire police said that after assessing all the
information available surrounding the incident, the force had concluded “that
there are no criminal offences that have been disclosed at this time”.
There are increasing
instances of statues sought to be downed and Companies made to apologise for
their role in slave trade in past centuries.
One important, but overlooked, risk mitigation device that facilitated
the growth of the slave trade in the eighteenth century was the increasing
availability of insurance for ships and their human cargoes. In 1856, just five years before the outbreak
of the Civil War, the Charter Oak Life Insurance Company printed a pamphlet
offering slave owners in six Southern states the option of insuring the lives
of their slaves.
For just $2, Kentucky,
Missouri and Tennessee residents, for example, could purchase a 12-month policy
from the Hartford-based insurer on a 10-year-old domestic servant that would
yield $100 if the slave died. Policies for older slaves, like a 45-year-old,
were more expensive, costing the slave owner $5.50 a year.
Though the company no
longer exists, these policies are drawing increasing attention nearly 150 years
later because of a lawsuit that was filed in United States District Court in
Brooklyn, in late March against Aetna Inc. and two other companies, claiming
that they profited from the slave trade.
It's not pleasant to talk about it today, to put it mildly, but slaves
were insured just like any other thing that the farmers owned, that the slave
owners owned,'' said an Insurance analyst ''If you were selling insurance in slave
states to people who had plantations, that was one of the things that you sold.
''It was very common,'' he added. ''Basically, insurance and slavery go all the
way back in history of Nations and Insurance”.
Recently, Insurance and
reinsurance marketplace Lloyd’s of London apologised for its links to the slave trade in
the 18th and 19th centuries, and announced that it plans to pay reparations via
donations to BAME charities. Lloyd’s grew to dominate the shipping insurance
market, a key element of Europe’s global scramble for empire, treasure and
slaves, who were usually in the 18th Century included in insurance policies in
the general rate for ship cargo. Weapons and gunpowder from Europe were swapped
for African slaves who were shipped across the Atlantic to the Americas. Those
who survived endured a life of subjugation on plantations, while the ships
returned to Europe laden with sugar, cotton and tobacco.
The history of insurance
begins with the sea. Lloyd’s released a
statement condemning “the indefensible wrongdoing that occurred during this
period” after its role in the slave trade was highlighted in a major academic
database. Many companies in the financial sector are currently facing intense
scrutiny over racial issues, after the police killing of African American
George Floyd in the US sparked a wave of global protests. The UK in particular
has seen its historical links to the slave trade spotlighted after a statue of
slave trader Edward Colston was torn down by protestors in Bristol, prompting
the removal of similar statues across the nation.
Lloyd’s was
founded in 1688 and has its roots in maritime insurance, meaning many of the
ships it insured during its early years were involved in the trans-Atlantic
slave trade. “Lloyd’s has a long and rich history dating back over
330 years, but there are some aspects of our history that we are not proud of,”
the firm stated. In addition to these
apologies, Lloyd’s has pledged to provide financial support to charities and
organisations promoting opportunity and inclusion for black and minority ethnic
(BAME) groups.
It is perhaps unsurprising that Lloyd’s has
been quick to acknowledge and apologise for this particular controversy, given
its recent push for stronger inclusivity measures. These measures were
introduced last year as part of the Future at Lloyd’s program, in response to
reports of widespread sexual harassment and employee wellbeing issues in the
marketplace.
Fidelis, Aon
and Marsh have developed a new marine cargo clause for the London Market that
is designed to keep the products of modern slavery out of the export supply
chain. The group of brokers and insurers say the
clause will make it a condition of marine cargo policies that the insured
complies with applicable legal and regulatory obligations in respect of forced
and child labour. “Forced labour in all its forms is an extreme expression of
inequality and injustice,” said Charles Mathias, Group Executive Director &
Group Chief Risk Officer, Fidelis Insurance.
“We sometimes think that
slavery is a thing of the past, but it is not – it is real and present in all
societies and we want to do our part to root it out.” The
clause makes it a condition of marine cargo policies that the insured complies
with applicable legal and regulatory obligations concerning forced and child
labour. The announcement of the new clause comes amid the international
outcry against the systemic racism following the police killing of African
American George Floyd in the US.
Quite
curious to think on the interpretation and imposition of such a clause when
there is a cargo claim – would that mean that in a claim on insured products produced by forced or child
labour would be construed as outside purview of a claim under Marine Policy ! (though
otherwise legal transit and a tenable claim arising out of a maritime peril).
With regards – S.
Sampathkumar
24.6.2020.
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