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Marine Insurance: Law and Practice

CHAPTER 25

QUANTIFYING THE INDEMNITY1

I INTRODUCTION

The object of the indemnity

25.1 It is a generally accepted but bizarre fiction—indeed, so firmly accepted that it is rarely recognised as a fiction—that the insurer’s undertaking in a contract of marine insurance is to hold the assured unharmed by insured perils.1 This fiction is not carried through to requiring the insurer or his representative to ride shotgun on the insured adventure, in order to discharge a duty to guard against the operation of insured perils. But it is carried through to analysing the insurer’s liability in the case of an insured loss as being for breach of contract, with the normal remedy of damages (not simply using the word “damages” in the loose sense of an unliquidated liability to pay a sum of money).

2

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