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Provisions of the Supreme People's
Court on Several Issues about the Trial of Cases Concerning Marine
Insurance Disputes
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Announcement
of the Supreme People's Court
The Provisions of the Supreme People's Court on Several Issues about
the Trial of Cases Involving Marine Insurance Disputes, which have
been adopted at the 1405th meeting of the Judicial Committee of the
Supreme People's Court on November 13, 2006, are hereby promulgated
and shall come into force as of January 1, 2007.
November 23, 2006
Provisions of the Supreme People's Court on Several Issues about the
Trial of Cases Concerning Marine Insurance Disputes
(Adopted at the 1405th meeting of the Judicial Committee of the
Supreme People's Court on November 13, 2006, Judicial Interpretation
No. 10 [2006])
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2 The trial of the cases concerning the disputes over marine
insurance contracts with the port facilities or docks as insurance
objects that do not result from marine accidents shall be governed by
the legal provisions in the
Insurance Law.
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3 The trial of the cases in which the insurer exercises the right of
subrogation due to an insurance accident arising out of collision of
vessels with the port facilities or docks, and claims for
compensation from the third person that causes the insurance accident
shall be governed by the provisions in the Maritime Law.
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4 Where the insurer knows that the insured failed to faithfully
report the important information as prescribed in Paragraph 1 of Article 222 of the Maritime Law but still collects
insurance premiums or pays insurance compensations, if the insurer
later claims rescission of the contract for the reason that the
insured failed to faithfully report the important information, the
people's court shall not support its claim.
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5 Where the insured fails to pay the insurance premiums as stipulated
to the insurer according to Article
234 of the Maritime Law,
the insurer has the right to rescind the insurance contract before
the insurance liability begins, unless the insurer has issued
insurance documents; if the insurer claims rescission of the contract
after the insurance liability begins for the reason that the insured
failed to pay the insurance premium, the people's court shall not
support its claim.
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6 In case the insurer claims rescission of the insurance contract
from the day in which the guarantee clause is violated for the reason
that the insured violated the guarantee clause as stipulated in the
contract and failed to immediately notify the insurer in writing, the
people's court shall support its claim.
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7 In case the insurer still pays the insurance compensations after
receipt of the written notice that the insured violated the guarantee
clause as stipulated in the contract, but later claims rescission of
the contract for the reason that the insured violated the guarantee
clause as stipulated in the contract, the people's court shall not
support its claim.
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8 In case the insurer fails to reach an unanimity with the insured
with respect to the revision of underwriting conditions or increase
of insurance premiums after it has received a written notice that the
insured violated the guarantee clause as stipulated in the contract,
the insurance contract shall have been rescinded as of the day when
the guarantee clause is violated.
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Article
9 In case a vessel is transferred in a voyage, the vessel insurance
contract in which the insurer does not consent to the transfer of the
vessel shall be rescinded after the voyage ends. The rights and
obligations to the vessel insurance contract from the transfer of the
vessel to the conclusion of the voyage shall be respectively enjoyed
and assumed by the vessel transferor, and may also be succeeded by
the vessel transferee.
When the vessel transferee claims for compensation against the
insurer according to the preceding Paragraph, it shall submit valid
insurance documents and the certificate on the vessel transfer
contract.
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10 In case neither the insurer nor the insured knows that the
insurance object has suffered any loss in an insurance accident when
the insurance contract is concluded, or the insurance object could
not possibly suffer any loss in the accident insurance, the
effectiveness of the insurance contract shall not be affected.
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11 The losses resulting from the failure of the carrier to deliver
goods due to the nonexistence of the original bill of lading in the
marine goods transport do not fall within the scope of insurance
liability of the insurer, unless it is otherwise stipulated by both
parties in the insurance contract.
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12 Where the insured takes reasonable measures after an insurance
accident occurs in order to prevent or reduce losses but to no avail
and the insured requires the insurer to pay reasonable fees incurred
therefrom, the people's court shall support it.
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13 In case the insurer, when exercising the right of subrogation to
claim for compensations, fails to submit the people's court the
vouchers proving that it has actually paid the insurance compensation
to the insured according to the provisions in the Special Maritime Procedure Law,
the people's court shall not accept its claim; if the court has
accepted the claim, it shall make a ruling to reject the litigation.
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14 The people's court that accepts a case involving any dispute over
the insurer's exercise of the right of subrogation to claim for
compensations shall only try the legal relationship between the third
party that caused the insurance accident and the insured.
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15 In case the insurer, after obtaining the right of subrogation to
claim for compensations, claims for the interruption of the
limitation of actions for the reason that the insured filed a lawsuit
or arbitration against the third party or applied for seizure of the
vessel, or the third party consents to perform its obligation, the
people's court shall support the claim.
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16 In case the insurer, after obtaining the right of subrogation to
claim for compensations, claims for the guaranty rights of the
insured due to the application for the seizure of the vessel, the
people's court shall support the claim.
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17 These Provisions shall come into force as of January 1, 2007.
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