§ 1979 Insurer'S Salvage Rights

If a marine insurer pays a claim as if the ship or cargo were completely lost, the insurer gets any leftover stuff, salvage, or money from it, just like if the owner had officially abandoned it.

Key Takeaways

•When the insurer treats a loss as a total loss, they gain rights to any remaining property or its value.
•These rights are the same as those the owner would have after formally abandoning the property.
•The rule applies only to marine insurance (ships, cargo, etc.).

Example

A cargo ship sinks in a storm. The insurer pays the shipowner the full insured amount, treating the ship as a total loss.

Because the insurer paid as if the ship were totally lost, the insurer can now claim the wreck, any recovered cargo, or the money from selling the wreck, just like the owner would have if they had formally abandoned the ship.

Whenever a marine insurer pays for a loss as if it were an actual total loss, he is entitled to whatever remains of the subject matter insured, or its proceeds or salvage, to the same extent as in the case of a formal abandonment. (Enacted by Stats. 1935, Ch. 145.)

If a marine insurer pays a claim as if the ship or cargo were completely lost, the insurer gets any leftover stuff, salvage, or money from it, just like if the owner had officially abandoned it.

Key Takeaways

•When the insurer treats a loss as a total loss, they gain rights to any remaining property or its value.
•These rights are the same as those the owner would have after formally abandoning the property.
•The rule applies only to marine insurance (ships, cargo, etc.).

Example

A cargo ship sinks in a storm. The insurer pays the shipowner the full insured amount, treating the ship as a total loss.

Key Takeaways

Example

Key Terms

References

§ 1979 Insurer'S Salvage Rights

Key Takeaways

Example

Key Terms

References

Key Takeaways

Example

Key Terms

Related Statutes

References

Key Takeaways

Example

Key Terms

Related Statutes

References