Highlights of Sellers Interest Insurance Policy

There are situations in which the seller will continue to have an insurable interestthough title to the goods has passed to the buyer. For example, the seller of the goods on FOB orother terms under which the title passes to the buyer at some point in transit, will have a financialinterest in the goods until payment has been received. This kind of situation will arise when theterms of payment call for sight draft against documents or for acceptance at 30-60 days sight.There may be situations where the buyer is uninsured or his insurance coverage is inadequatebecause of underinsurance or restricted conditions, in which case his desire to pay as originally contemplated after loss or damage to the goods will be impaired.

Seller’s Interest Insurance Clause

1. This policy covers physical loss of or damage to the cargo insured, subject to the termsand conditions of the policy, to protect only the interest of the insured mentioned therein.This insurance is not assignable to any other person who may acquire insurable interest in respect of property insured excepting a banker operating in India; any assignment other than as stated shall render this policy void.
2. Warranted that the insured shall not change the terms of the contract of sale relating to goods insured hereunder, subsequent to the operation of a peril insured against for the purpose of securing indemnity under the policy.
3. Warranted that the insured shall safeguard all contractual and other rights against the buyers, carriers and other parties concerned with the transactions and transport of the goods covered therein.
4. No claim shall be payable hereunder if either the named insured or the buyer of the insured goods is entitled to indemnification under any other policy covering the same goods, which may be in existence.
5. Claims, if any, are payable in Indian currency only.
6. (Underwriters shall be subrogated to the assured’s rights against third parties.
7. This policy does not cover the risks which could be covered or which are insurable by the Export Credit Guarantee Corporation of India Ltd.