name: Marine Insurance Act
unofficial_text: # Marine Insurance Act
  
  SC 1993, c 22
  
  An Act respecting marine insurance
  
  Assented to 1993-5-6
  
  Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows: 
  
  ## Short Title 
  
  ### Short title
  
  1 This Act may be cited as the Marine Insurance Act.  
  
  ## Interpretation and Application 
  
  ### Definitions
  
  2 (1) In this Act,  
  *action* includes a counterclaim and a set-off; (action)   
  *contract* means a contract of marine insurance as described in subsection 6(1); (contrat)   
  *freight* includes the profit derivable by a shipowner from the use of the shipowner’s ship to carry the shipowner’s goods or movables and freight payable by a third party, but does not include passenger fares; (fret)   
  *goods* means goods in the nature of merchandise, but does not include personal effects or provisions or stores for use on board a ship; (marchandises)   
  *insurable property* means any ship, goods or movables; (bien assurable)   
  *marine adventure* means any situation where insurable property is exposed to maritime perils, and includes any situation where  
  (a) the earning or acquisition of any freight, commission, profit or other pecuniary benefit, or the security for any advance, loan or disbursement, is endangered by the exposure of insurable property to maritime perils, and 
  (b) any liability to a third party may be incurred by the owner of, or other person interested in or responsible for, insurable property, by reason of maritime perils; ( opérations maritimes)   
  *marine policy* means the instrument evidencing a contract; (police maritime)   
  *maritime perils* means the perils consequent on or incidental to navigation, including perils of the seas, fire, war perils, acts of pirates or thieves, captures, seizures, restraints, detainments of princes and peoples, jettisons, barratry and all other perils of a like kind and, in respect of a marine policy, any peril designated by the policy; (périls de mer)   
  *movable* means any movable tangible property, other than a ship or goods, and includes money, valuable securities and other documents; (bien mobilier)   
  *ship* includes the hull, machinery, materials and outfit and the stores and provisions for the officers and crew and also includes fuel, oils and engine stores, if they are owned by the insured, and, in the case of a ship engaged in a special trade, the ordinary fittings required for the trade. (navire)  
  
  ### Other terms
  
  (2) The following terms have the meanings assigned by the provisions indicated beside them: 
  (a) actual total loss, subsection 56(1); 
  (b) constructive total loss, section 57; 
  (c) general average act, subsection 65(2); 
  (d) general average contribution, subsection 65(3); 
  (e) general average expenditure, subsection 65(2); 
  (f) general average loss, subsection 65(1); 
  (g) general average sacrifice, subsection 65(2); 
  (h) particular average loss, subsection 63(1); 
  (i) particular charges, subsection 63(2); 
  (j) salvage charges, subsection 64(1); 
  (k) time policy, subsection 29(3); 
  (l) unvalued policy, subsection 30(3); 
  (m) valued policy, subsection 30(2); and 
  (n) voyage policy, subsection 29(2). 
  
  ### Construction of marine policies
  
  3 Subject to this Act and unless a contrary intention appears, the words and terms set out in the schedule have, when used in a marine policy, the meanings assigned by the schedule. 
  
  ### Rules of Canadian maritime law
  
  4 The rules of Canadian maritime law continue to apply in respect of contracts, except in so far as the rules are inconsistent with this Act. 
  
  ### Application
  
  5 This Act applies in respect of contracts concluded on or after the coming into force of this Act. 
  
  ## Contract of Marine Insurance 
  
  ### Contract of marine insurance
  
  6 (1) A contract of marine insurance is a contract whereby the insurer undertakes to indemnify the insured, in the manner and to the extent agreed in the contract, against 
  (a) losses that are incidental to a marine adventure or an adventure analogous to a marine adventure, including losses arising from a land or air peril incidental to such an adventure if they are provided for in the contract or by usage of the trade; or 
  (b) losses that are incidental to the building, repair or launch of a ship. 
  
  ### Coverage
  
  (2) Subject to this Act, any lawful marine adventure may be the subject of a contract. 
  
  ## Insurable Interest 
  
  ### Insurable interest required
  
  7 (1) In order to recover under a contract for a loss, the insured must have an insurable interest in the subject-matter insured at the time of the loss, but need not have such an interest when the contract is concluded. 
  
  ### “Lost or not lost” insurance
  
  (2) Notwithstanding subsection (1), where the subject-matter is insured “lost or not lost”, the insured may recover in respect of an insurable interest in the subject-matter acquired after a loss unless, at the time the contract was concluded, the insured was aware of the loss and the insurer was not. 
  
  ### Where no interest
  
  (3) An insured who has no insurable interest in the subject-matter insured at the time of a loss cannot acquire an insurable interest by any act or election after becoming aware of the loss. 
  
  ### Insurable interest - general principle
  
  8 (1) Subject to this Act, a person who has an interest in a marine adventure has an insurable interest. 
  
  ### Interest in marine adventure
  
  (2) A person has an interest in a marine adventure if the person has a legal or equitable relation to the adventure, or to any insurable property at risk in the adventure, and may benefit from the safety or due arrival of insurable property, may be prejudiced by its loss, damage or detention or may incur liability in respect of it. 
  
  ### Defeasible or contingent interests
  
  9 (1) A defeasible interest and a contingent interest are insurable interests. 
  
  ### Buyer of goods
  
  (2) A buyer of goods who has insured them has an insurable interest even though the buyer might have elected to reject the goods or to treat them as at the seller’s risk for any reason, including a delay in delivering them. 
  
  ### Partial interest
  
  10 A partial interest of any nature is an insurable interest. 
  
  ### Master and crew’s wages
  
  11 The master and any member of the crew of a ship have insurable interests in their own wages. 
  
  ### Advance freight
  
  12 A person who advances freight has an insurable interest, in so far as the freight is not repayable in case of loss. 
  
  ### Charges of insurance
  
  13 An insured has an insurable interest in the charges for any insurance that the insured has effected. 
  
  ### Reinsurance
  
  14 The insurer under a contract has an insurable interest in the risk insured and may reinsure in respect of it, but, unless the marine policy provides otherwise, the original insured has no right or interest in the reinsurance. 
  
  ### Bottomry
  
  15 A lender of money on the security of a ship or a ship’s cargo has an insurable interest in respect of the loan. 
  
  ### Quantum of mortgagor’s interest
  
  16 (1) A mortgagor of insurable property has an insurable interest in its full value, and the mortgagee has an insurable interest in any sum due or to become due under the mortgage. 
  
  ### Interest of mortgagee, consignee or other person
  
  (2) A mortgagee, consignee or other person who has an insurable interest in the subject-matter insured may insure on the person’s own behalf, on behalf and for the benefit of any other interested person or both on the person’s own behalf and on behalf and for the benefit of any other interested person. 
  
  ### Quantum of owner’s interest
  
  (3) The owner of insurable property has an insurable interest in its full value, even where a third person has agreed, or is liable, to indemnify the owner in case of loss. 
  
  ### Assignment of interest
  
  17 (1) An insured who assigns or otherwise parts with an insurable interest in the subject-matter insured does not thereby transfer the rights of the insured under the contract, unless there is an express or implied agreement to that effect. 
  
  ### Exception
  
  (2) Subsection (1) does not apply in respect of a transmission of interest by operation of law. 
  
  ### Gaming or wagering contracts void
  
  18 (1) Every contract by way of gaming or wagering is void. 
  
  ### Presumption
  
  (2) A contract is deemed to be a contract by way of gaming or wagering if 
  (a) the insured has no insurable interest within the meaning of this Act and the contract is concluded with no expectation of acquiring such an interest; or 
  (b) the marine policy is made “interest or no interest”, “without further proof of interest than the policy itself” or “without benefit of salvage to the insurer” or is subject to any other like term. 
  
  ### Exception
  
  (3) Paragraph (2)(b) does not apply in respect of a marine policy that is made “without benefit of salvage to the insurer” or is subject to any other like term, if there is no possibility of salvage. 
  
  ## Insurable Value 
  
  ### Calculation of insurable value
  
  19 (1) Subject to any express provision of, or any value specified in, the marine policy, the insurable value of the subject-matter insured is 
  (a) in the case of insurance on a ship, the aggregate of the value of the ship at the commencement of the risk and the charges of insurance; 
  (b) in the case of insurance on freight, whether paid in advance or not, the aggregate of the gross amount of the freight at the risk of the insured and the charges of insurance; 
  (c) in the case of insurance on goods, the aggregate of the prime cost of the goods, the expenses of and incidental to shipping and the charges of insurance on those goods and expenses; and 
  (d) in the case of insurance on any other subject-matter, the aggregate of the amount at the risk of the insured when the policy attaches and the charges of insurance. 
  
  ### Value of ship
  
  (2) For the purposes of paragraph (1)(a), the value of a ship includes money advanced for officers’ and crew’s wages and other disbursements incurred to make the ship fit for the marine adventure contemplated by the marine policy. 
  
  ## Disclosure and Representations 
  
  ### Utmost good faith
  
  20 A contract is based on the utmost good faith and, if the utmost good faith is not observed by either party, the contract may be avoided by the other party. 
  
  ### Disclosure by insured
  
  21 (1) Subject to this section, an insured must disclose to the insurer, before the contract is concluded, every material circumstance that is known to the insured. 
  
  ### Disclosure by agent of insured
  
  (2) Subject to this section, an agent who effects insurance for an insured must disclose to the insurer, before the contract is concluded, 
  (a) every material circumstance that is known to the agent; and 
  (b) every material circumstance that the insured must disclose, unless the insured learned of it too late to communicate it to the agent. 
  
  ### Material circumstance
  
  (3) A circumstance is material if it would influence the judgment of a prudent insurer in fixing the premium or determining whether to take the risk. 
  
  ### Question of fact
  
  (4) Whether any circumstance that is not disclosed is material or not is a question of fact. 
  
  ### Circumstances not disclosed
  
  (5) In the absence of any inquiry, the following circumstances need not be disclosed: 
  (a) any circumstance that diminishes the risk; 
  (b) any circumstance that is known to the insurer; 
  (c) any circumstance as to which information is waived by the insurer; and 
  (d) any circumstance the disclosure of which is superfluous by reason of any express warranty or implied warranty. 
  
  ### Presumptions
  
  (6) For the purposes of this section, 
  (a) an insured is deemed to know every circumstance that, in the ordinary course of business, ought to be known by the insured; 
  (b) an agent is deemed to know every circumstance that, in the ordinary course of business, ought to be known by, or to have been communicated to, the agent; and 
  (c) an insurer is presumed to know circumstances of common notoriety and every circumstance that, in the ordinary course of an insurer’s business, ought to be known by an insurer. 
  
  ### Effect of non-disclosure
  
  (7) If an insured or an agent of an insured fails to make a disclosure as required by this section, the insurer may avoid the contract. 
  
  ### Definition of “circumstance”
  
  (8) In this section, 
  *circumstance* includes any communication made to, or information received by, the insured.  
  
  ### Representations by insured or agent
  
  22 (1) Every material representation made by the insured or the insured’s agent to the insurer during the negotiations for the contract and before the contract is concluded must be true. 
  
  ### Material representation
  
  (2) A representation is material if it would influence the judgment of a prudent insurer in fixing the premium or determining whether to take the risk. 
  
  ### Question of fact
  
  (3) Whether any representation is material or not is a question of fact. 
  
  ### Types of representations
  
  (4) A representation may be as to a matter of fact or as to a matter of expectation or belief. 
  
  ### Fact
  
  (5) A representation as to a matter of fact is deemed to be true if the difference between what is represented and what is actually correct would not be considered material by a prudent insurer. 
  
  ### Expectation or belief
  
  (6) A representation as to a matter of expectation or belief is deemed to be true if it is made in good faith. 
  
  ### Withdrawal or correction
  
  (7) A representation may be withdrawn or corrected before a contract is concluded. 
  
  ### Effect of false representations
  
  (8) If any material representation made by the insured or the insured’s agent to the insurer during the negotiations for the contract is not true and is not withdrawn or corrected before the contract is concluded, the insurer may avoid the contract. 
  
  ## Conclusion and Ratification of Contracts 
  
  ### When contract is deemed to be concluded
  
  23 A contract is deemed to be concluded when the proposal of the insured is accepted by the insurer, whether the marine policy is then issued or not, and for the purpose of establishing when the proposal is accepted, the slip or covering note or other customary memorandum of the contract may be referred to. 
  
  ### Ratification
  
  24 A contract effected in good faith by a person on behalf of another person may be ratified by that other person even after the other person becomes aware of a loss. 
  
  ## The Marine Policy 
  
  ### Marine policy required
  
  25 (1) A contract is inadmissible in evidence, unless it is evidenced by a marine policy in accordance with this Act. 
  
  ### Issue of marine policy
  
  (2) A marine policy may be executed and issued when the contract is concluded or afterwards. 
  
  ### Contents of marine policy
  
  26 A marine policy must specify 
  (a) the name of the insured or of a person who effects the insurance on behalf of the insured; 
  (b) the subject-matter insured; 
  (c) the perils insured against; 
  (d) the voyage or period, or both, covered by the insurance; 
  (e) the sum insured; and 
  (f) the name of the insurer. 
  
  ### Signature of insurer
  
  27 (1) A marine policy must be signed by or on behalf of the insurer. 
  
  ### Exception
  
  (2) Notwithstanding subsection (1), where the insurer is a corporation, the corporate seal is sufficient. 
  
  ### Subscription by two or more insurers
  
  (3) Where a marine policy is subscribed by or on behalf of two or more insurers, each subscription, unless the contrary is expressed, constitutes a distinct contract with the insured. 
  
  ### Specification of subject-matter
  
  28 (1) A marine policy must specify the subject-matter insured with reasonable certainty, but need not specify the nature and extent of the interest of the insured in that subject-matter. 
  
  ### Specification in general terms
  
  (2) A marine policy that specifies the subject-matter insured in general terms shall be construed to apply to the interest intended by the insured to be covered. 
  
  ### Usage
  
  (3) Any usage regulating the specification of the subject-matter insured shall be taken into consideration in applying this section. 
  
  ### Voyage and time policies
  
  29 (1) A marine policy may be a voyage policy or a time policy. 
  
  ### Voyage policy
  
  (2) A marine policy is a voyage policy if the contract insures the subject-matter “at and from”, or “from”, one place to another place or other places. 
  
  ### Time policy
  
  (3) A marine policy is a time policy if the contract insures the subject-matter for a definite period. 
  
  ### Combined policies
  
  (4) A marine policy may include a contract insuring the subject-matter as described in subsections (2) and (3). 
  
  ### Valued and unvalued policies
  
  30 (1) A marine policy may be a valued policy or an unvalued policy. 
  
  ### Valued policy
  
  (2) A marine policy is a valued policy if it specifies the agreed value of the subject-matter insured. 
  
  ### Unvalued policy
  
  (3) A marine policy is an unvalued policy if it does not specify the value of the subject-matter insured and, subject to the limit of the sum insured, leaves the value to be determined in accordance with section 19. 
  
  ### Value specified
  
  (4) Subject to this Act and in the absence of fraud, the value specified by a valued policy is, as between the insurer and the insured, conclusive of the insurable value of the subject-matter intended to be insured, regardless of whether any loss is a total loss or a partial loss. 
  
  ### Idem
  
  (5) Unless a valued policy otherwise provides, the value specified by the policy is not conclusive for the purpose of determining whether there has been a constructive total loss. 
  
  ### Floating policy
  
  31 (1) A marine policy may be a floating policy, that is to say, a policy that describes the insurance in general terms and leaves the name of the ship and other particulars to be defined by subsequent declarations, either by endorsement on the policy or in any other customary manner. 
  
  ### Declarations
  
  (2) Unless a floating policy otherwise provides, declarations must be made in the order of dispatch or shipment and must, in the case of goods, include all consignments within the terms of the policy and honestly state the value of the goods. 
  
  ### Rectification
  
  (3) An omission in a declaration or an erroneous declaration may be rectified even after loss or arrival if the omission or declaration was made in good faith. 
  
  ### Idem
  
  (4) Unless a floating policy otherwise provides, where a declaration of value is not made until after notice of loss or arrival, the policy shall be treated as an unvalued policy with respect to the subject-matter of that declaration. 
  
  ## Warranties 
  
  ### Definition of “warranty”
  
  32 (1) In this section and sections 33 to 39, 
  *warranty* means a promissory warranty by which the insured  
  (a) undertakes that some particular thing will or will not be done or that some condition will be fulfilled; or 
  (b) affirms or negates the existence of particular facts. 
  
  ### Types of warranty
  
  (2) A warranty may be an express warranty or an implied warranty. 
  
  ### Express warranties
  
  33 (1) An express warranty may be in any form of words from which the intention to warrant may be inferred. 
  
  ### Inclusion in policy
  
  (2) An express warranty must be included in, or written on, the marine policy or be contained in a document incorporated by reference into the policy. 
  
  ### Exclusion of implied warranty
  
  (3) An express warranty does not exclude an implied warranty, unless they are inconsistent. 
  
  ### Warranty of legality
  
  34 There is an implied warranty in every marine policy that the marine adventure insured is lawful and, in so far as the insured has control, will be carried out in a lawful manner. 
  
  ### No implied warranty of nationality
  
  35 There is no implied warranty in any marine policy as to the nationality of a ship or that the nationality of a ship will not be changed during the risk. 
  
  ### Warranty of neutrality
  
  36 (1) Where in any marine policy insurable property is expressly warranted to be neutral, there is an implied condition in the policy 
  (a) that the property will have a neutral character at the commencement of the risk and that, in so far as the insured has control, that character will be preserved during the risk; and 
  (b) where the property is a ship, that, in so far as the insured has control, the papers necessary to establish the neutrality of the ship will be carried on the ship and will not be falsified or suppressed and no simulated papers will be used. 
  
  ### Breach of condition
  
  (2) If any loss occurs through a breach of the implied condition referred to in paragraph (1)(b), the insurer may avoid the contract. 
  
  ### Warranty of seaworthiness of ship in voyage policy
  
  37 (1) There is an implied warranty in every voyage policy that, at the commencement of the voyage, the ship will be seaworthy for the purpose of the particular marine adventure insured. 
  
  ### Warranty of fitness against perils of the port
  
  (2) Where a voyage policy attaches while the ship is in port, there is an implied warranty in the policy that the ship will, at the commencement of the risk, be reasonably fit to encounter the ordinary perils of the port. 
  
  ### Warranty of fitness for each stage of voyage
  
  (3) Where a voyage policy relates to a voyage performed in different stages during which the ship requires different or further preparation or equipment, there is an implied warranty in the policy that, at the commencement of each stage, the ship is seaworthy for the purposes of that stage. 
  
  ### No implied warranty of seaworthiness in time policy
  
  (4) There is no implied warranty in any time policy that the ship will be seaworthy at any stage of the marine adventure, but where, with the privity of the insured, the ship is sent to sea in an unseaworthy state, the insurer is not liable for any loss attributable to unseaworthiness. 
  
  ### When ship deemed seaworthy
  
  (5) A ship is deemed to be seaworthy if it is reasonably fit in all respects to encounter the ordinary perils of the seas of the marine adventure insured. 
  
  ### No implied warranty that goods are seaworthy
  
  38 (1) There is no implied warranty in any marine policy on insurable property, other than a ship, that the insurable property is seaworthy. 
  
  ### Voyage policy on goods
  
  (2) There is an implied warranty in every voyage policy on insurable property, other than a ship, that, at the commencement of the voyage, the ship is seaworthy and reasonably fit to carry the insurable property to the destination contemplated by the policy. 
  
  ### Compliance with warranty
  
  39 (1) Subject to this section, a warranty must be exactly complied with, whether or not it is material to the risk. 
  
  ### Effect of breach of warranty
  
  (2) Subject to any express provision in the marine policy or any waiver by the insurer, where a warranty is not exactly complied with, the breach of the warranty discharges the insurer from liability for any loss occurring on or after the date of the breach, but does not affect any liability incurred by the insurer before that date. 
  
  ### Breach of warranty of good safety
  
  (3) A warranty that the subject-matter insured is “well” or “in good safety” on a particular day is not breached if the subject-matter is safe at any time during that day. 
  
  ### When breach of warranty excused
  
  (4) A breach of a warranty is excused if, because of a change of circumstances, the warranty ceases to be applicable to the circumstances contemplated by the contract or if compliance with the warranty is rendered unlawful by any subsequent law. 
  
  ### Limit on defence to breach of warranty
  
  (5) It is no defence to a breach of a warranty that the breach was remedied and the warranty complied with before any loss was incurred. 
  
  ## The Voyage 
  
  ### Implied condition as to commencement
  
  40 (1) Where the subject-matter is insured by a voyage policy, the ship need not, when the contract is concluded, be at the place at and from, or from, which the subject-matter is insured, but there is an implied condition in the policy that the marine adventure will commence within a reasonable time and, if it is not so commenced, the insurer may avoid the contract. 
  
  ### Exception
  
  (2) The implied condition may be negated by establishing that the delay was caused by circumstances known to the insurer before the contract was concluded or that the insurer waived the condition. 
  
  ### Change of port of departure
  
  41 (1) Where the place of departure is specified by a marine policy and the ship sails from a different place, the risk does not attach. 
  
  ### Change of destination
  
  (2) Where the destination is specified by a marine policy and the ship sails for a different destination, the risk does not attach. 
  
  ### Change of voyage
  
  42 (1) Unless a marine policy otherwise provides, a change of voyage discharges the insurer from liability for any loss occurring on or after the time when the intention to change is manifested, whether or not the ship has in fact left the course of voyage contemplated by the policy when the loss occurs. 
  
  ### Idem
  
  (2) There is a change of voyage where, after the commencement of the risk, the destination of the ship is voluntarily changed from that contemplated by the marine policy. 
  
  ### Deviation from voyage
  
  43 (1) A deviation without lawful excuse from the voyage contemplated by a marine policy discharges the insurer from liability for any loss occurring on or after the time when the deviation occurs, regardless of the intention to deviate and whether or not the ship returns to its course of voyage before the loss occurs. 
  
  ### Idem
  
  (2) There is a deviation from the voyage contemplated by a marine policy where 
  (a) the course of the voyage is specified by the policy and is departed from; or 
  (b) the course of the voyage is not specified by the policy but the usual and customary course is departed from. 
  
  ### Idem
  
  (3) Where a marine policy specifies the ports of discharge, the ship may proceed to any or all of them, but if, in the absence of any usage or sufficient cause, the ship does not proceed to them, or such of them as it goes to, in the order specified, there is a deviation from the voyage contemplated by the policy. 
  
  ### Idem
  
  (4) Where a marine policy specifies that the ports of discharge are within a given area and does not otherwise name them, the ship may proceed to any or all of them, but if, in the absence of any usage or sufficient cause, the ship does not proceed to them, or such of them as it goes to, in their geographical order, there is a deviation from the voyage contemplated by the policy. 
  
  ### Delay in voyage
  
  44 The marine adventure insured by a voyage policy must be carried out with reasonable dispatch and a delay, without lawful excuse, in carrying it out discharges the insurer from liability for any loss occurring on or after the time when the delay becomes unreasonable. 
  
  ### Excuses for deviation or delay
  
  45 (1) A deviation or delay referred to in section 43 or 44 is excused if it is 
  (a) authorized by any special term in the marine policy; 
  (b) caused by circumstances beyond the control of the master and the master’s employer; 
  (c) reasonably necessary in order to comply with an express warranty or an implied warranty; 
  (d) reasonably necessary for the safety of the ship or subject-matter insured; 
  (e) for the purpose of saving human life or aiding a ship in distress where human life may be in danger; 
  (f) reasonably necessary for the purpose of obtaining medical aid for any person on board the ship; or 
  (g) caused by the barratrous conduct of the master or crew, if barratry is one of the perils insured against. 
  
  ### Resumption
  
  (2) When the excuse for a deviation or delay ceases, the voyage must be resumed with reasonable dispatch. 
  
  ### Transhipment
  
  46 Where the voyage contemplated by a marine policy is interrupted, by a peril insured against, at an intermediate port or place in such circumstances as, apart from the contract of affreightment, justify the master in landing and reshipping, or transhipping, the goods or movables and sending them to their destination, the insurer continues to be liable for a loss occurring on or after the landing or transhipment. 
  
  ## The Premium 
  
  ### Premium to be arranged
  
  47 (1) A reasonable premium is payable if insurance is effected at a premium to be arranged and no arrangement is made. 
  
  ### Additional premium
  
  (2) A reasonable additional premium is payable if insurance is effected on the terms that an additional premium is to be arranged on the happening of a given event and that event happens but no arrangement is made. 
  
  ### Payment of premium
  
  48 Unless otherwise agreed, the duty of the insured or the insured’s agent to pay the premium and the duty of the insurer to issue the marine policy to the insured or the insured’s agent are concurrent conditions, and the insurer is not required to issue the policy until the premium is paid or tendered. 
  
  ### Policy effected through broker
  
  49 (1) Unless otherwise agreed, where a broker effects a marine policy on behalf of the insured, 
  (a) the broker is directly responsible to the insurer for the premium; 
  (b) the broker has, as against the insured, a lien on the policy for the amount of the premium and the broker’s charges in effecting the policy; and 
  (c) the insurer is directly responsible to the insured for any amount that may be payable in respect of losses or a returnable premium. 
  
  ### Idem
  
  (2) Unless otherwise agreed, where a broker effects a marine policy on behalf of a person who employs the broker as a principal, the broker has a lien on the policy in respect of any balance on any insurance account that may be due to the broker from that person, unless, when the debt was incurred, the broker had reason to believe that the person was only an agent. 
  
  ### Acknowledgement of receipt of premium
  
  50 Where a broker effects a marine policy on behalf of an insured, an acknowledgement in the policy of the receipt of the premium is, in the absence of fraud, conclusive as between the insurer and the insured, but not as between the insurer and the broker. 
  
  ## Assignment of Marine Policy 
  
  ### Marine policy assignable
  
  51 (1) A marine policy is assignable either before or after a loss, unless it expressly prohibits assignment. 
  
  ### Manner of assignment
  
  (2) A marine policy may be assigned by endorsement on the policy or in any other customary manner. 
  
  ### Effect of assignment
  
  (3) Where a marine policy is assigned so as to transfer the beneficial interest in the policy, the assignee of the policy is entitled to sue on it in the assignee’s name and, in any such action, the defendant is entitled to raise any defence arising out of the contract that the defendant would have been entitled to raise if the action had been brought in the name of the person by or on behalf of whom the policy was effected. 
  
  ### Loss of interest
  
  52 (1) Where an insured transfers or loses an interest in the subject-matter insured and does not, before or at the time of so doing, expressly or impliedly agree to assign the marine policy, no subsequent assignment of the marine policy is operative. 
  
  ### Exception
  
  (2) Subsection (1) does not apply in respect of an assignment of a marine policy after a loss. 
  
  ## Loss and Abandonment 
  
  ### Losses covered
  
  53 (1) Subject to this Act and unless a marine policy otherwise provides, an insurer is liable only for a loss that is proximately caused by a peril insured against, including a loss that would not have occurred but for the misconduct or negligence of the master or crew. 
  
  ### Losses specifically excluded
  
  (2) Without limiting the generality of subsection (1), an insurer is not liable for any loss attributable to the wilful misconduct of the insured nor, unless the marine policy otherwise provides, for 
  (a) in the case of insurance on a ship or goods, any loss proximately caused by delay, including a delay caused by a peril insured against; 
  (b) ordinary wear and tear, ordinary leakage or breakage or inherent vice or nature of the subject-matter insured; 
  (c) any loss proximately caused by vermin; or 
  (d) any loss or damage to machinery not proximately caused by maritime perils. 
  
  ### Total and partial losses
  
  54 A loss may be a total loss or a partial loss. 
  
  ### Types of total loss
  
  55 (1) A total loss may be an actual total loss or a constructive total loss. 
  
  ### Losses covered
  
  (2) Unless a marine policy otherwise provides, insurance against total loss includes both actual total loss and constructive total loss. 
  
  ### Actual total loss
  
  56 (1) A loss is an actual total loss if the subject-matter insured is destroyed or is so damaged as to cease to be a thing of the kind insured or if the insured is irretrievably deprived of the subject-matter. 
  
  ### Idem
  
  (2) Where a ship engaged in a marine adventure is missing and no news of the ship is received within a reasonable period, an actual total loss may be presumed. 
  
  ### Constructive total loss
  
  57 (1) Unless a marine policy otherwise provides, a loss is a constructive total loss if the subject-matter insured is reasonably abandoned because the actual total loss of the subject-matter appears unavoidable or the preservation of the subject-matter from actual total loss would entail costs exceeding its value when the costs are incurred. 
  
  ### Idem
  
  (2) Without limiting the generality of subsection (1), a loss is a constructive total loss if 
  (a) in the case of a ship or goods, the insured is deprived of possession of the ship or goods by reason of a peril insured against and either the insured is unlikely to recover the ship or goods or the cost of recovery would exceed the value of the ship or goods when recovered; 
  (b) in the case of a ship, the ship is so damaged by a peril insured against that the cost of repairing it would exceed the value of the ship when repaired; or 
  (c) in the case of goods, the goods are so damaged that the cost of repairing and forwarding them to their destination would exceed the value of the goods on arrival. 
  
  ### Cost of repair of ship
  
  (3) For the purposes of paragraph (2)(b), in estimating the cost of repairing a ship, no deduction may be made in respect of general average contributions to the repairs payable by other interested persons, but account is to be taken of the cost of future salvage operations and of any future general average contributions to which the ship would be liable if repaired. 
  
  ### Treatment
  
  58 (1) An insured may treat a constructive total loss as a partial loss or may abandon the subject-matter insured to the insurer and treat the constructive total loss as an actual total loss. 
  
  ### Notice of abandonment
  
  (2) Subject to this section and section 59, an insured who elects to abandon the subject-matter insured to the insurer must give a notice of abandonment to the insurer with reasonable diligence after the insured receives reliable information of the loss. 
  
  ### Time for inquiry
  
  (3) An insured who receives doubtful information of a loss is entitled to a reasonable time to make inquiries before giving a notice of abandonment. 
  
  ### Manner of giving notice
  
  (4) An insured may give a notice of abandonment orally or in writing, or partly orally and partly in writing, and in any terms that indicate the insured’s intention to abandon unconditionally the insured interest in the subject-matter to the insurer. 
  
  ### Failure to give notice
  
  (5) If an insured fails to give a notice of abandonment as required by this section, the constructive total loss may be treated only as a partial loss. 
  
  ### Notice not required
  
  59 (1) An insured is not required to give a notice of abandonment to the insurer if 
  (a) the loss is an actual total loss; 
  (b) notice is waived by the insurer; or 
  (c) at the time the insured receives information of the loss, there is no possibility of benefit to the insurer if notice were given to the insurer. 
  
  ### Idem
  
  (2) An insurer who has reinsured a risk is not required to give a notice of abandonment to the reinsurer. 
  
  ### Refusal of abandonment
  
  60 (1) If an insured gives a notice of abandonment as required by section 58, the rights of the insured are not prejudiced by a refusal of the insurer to accept the abandonment. 
  
  ### Acceptance of abandonment
  
  (2) An acceptance of an abandonment may be either express or implied from the conduct of the insurer, but the mere silence of an insurer after a notice of abandonment is given does not constitute an acceptance. 
  
  ### Effect of acceptance on insured
  
  (3) On acceptance of an abandonment, the abandonment is irrevocable. 
  
  ### Effect of acceptance on insurer
  
  (4) On acceptance of an abandonment, the insurer 
  (a) conclusively admits liability for the loss and the sufficiency of the notice of abandonment; and 
  (b) is entitled to acquire the interest of the insured in whatever remains of the subject-matter insured, including all proprietary rights incidental thereto. 
  
  ### Abandonment of ship
  
  (5) On acceptance of the abandonment of a ship, the insurer is entitled to 
  (a) any freight being earned at the time of, or earned subsequent to, the casualty causing the loss, less the costs incurred in earning it after the casualty; and 
  (b) if the ship is carrying the shipowner’s goods, reasonable remuneration for the carriage of the goods subsequent to the casualty. 
  
  ### Partial loss
  
  61 (1) A partial loss is any loss that is not a total loss. 
  
  ### Idem
  
  (2) Where insured goods reach their destination in specie but cannot be identified by reason of obliteration of marks or otherwise, the loss, if any, is a partial loss. 
  
  ### Recovery for partial loss
  
  (3) Unless a marine policy otherwise provides, an insured who brings an action for a total loss but establishes only a partial loss may recover for a partial loss. 
  
  ### Types of partial losses
  
  62 A partial loss may be a particular average loss, a general average loss, salvage charges or particular charges. 
  
  ### Particular average loss
  
  63 (1) A particular average loss is a loss of the subject-matter insured that is caused by a peril insured against and is not a general average loss, but does not include particular charges. 
  
  ### Particular charges
  
  (2) Particular charges are expenses incurred by or on behalf of an insured for the purpose of preserving the subject-matter insured from a peril insured against, but do not include a general average loss or salvage charges. 
  
  ### Salvage charges
  
  64 (1) Salvage charges are charges recoverable under maritime law by a salvor independently of any contract, but do not include expenses incurred for services in the nature of salvage rendered by the insured or the insured’s agent, or any person hired by the insured or the insured’s agent, for the purpose of averting a loss by a peril insured against. 
  
  ### Recovery of salvage charges
  
  (2) Subject to any express provision in the marine policy, salvage charges incurred for the purpose of averting a loss by a peril insured against may be recovered from the insurer as a loss by such a peril. 
  
  ### Recovery of other expenses
  
  (3) The expenses referred to in subsection (1) that are not salvage charges may, when properly incurred, be recovered from the insurer as particular charges or as a general average loss, according to the circumstances under which they were incurred. 
  
  ### General average loss
  
  65 (1) A general average loss is a loss caused by or directly consequential on a general average act, and includes a general average sacrifice and a general average expenditure. 
  
  ### General average act, sacrifice and expenditure
  
  (2) A general average act is any extraordinary sacrifice or expenditure, known as a general average sacrifice and a general average expenditure, respectively, that is voluntarily and reasonably incurred in time of peril for the purpose of preserving the property from peril in a common adventure. 
  
  ### General average contribution
  
  (3) Subject to the conditions imposed by maritime law, a person who incurs a general average loss is entitled to receive from the other interested persons a rateable contribution, known as a general average contribution, in respect of the loss. 
  
  ### Recovery of general average expenditure and general average sacrifice
  
  (4) Subject to any express provision in the marine policy, 
  (a) an insured who incurs a general average expenditure may recover from the insurer in respect of the proportion of the loss falling on the insured; and 
  (b) an insured who incurs a general average sacrifice may recover from the insurer in respect of the whole loss, without having enforced the insured’s right to contribution from other persons. 
  
  ### Recovery of general average contribution
  
  (5) Subject to any express provision in the marine policy, an insured who has paid, or is liable to pay, a general average contribution in respect of the subject-matter insured may recover the contribution from the insurer. 
  
  ### Condition
  
  (6) Subject to any express provision in the marine policy, an insurer is not liable for a general average loss or a general average contribution, unless the loss was incurred for the purpose of averting, or in connection with the avoidance of, a peril insured against. 
  
  ### Where single ownership
  
  (7) Where any ship, freight and goods, or any two of them, are owned by the same insured, the liability of the insurer for a general average loss or a general average contribution shall be determined as if they were owned by different persons. 
  
  ## Measure of Indemnity 
  
  ### Measure of indemnity
  
  66 The measure of indemnity in respect of a loss under a marine policy is the amount that the insured can recover in respect of the loss under the policy, such amount not exceeding 
  (a) in the case of an unvalued policy, the insurable value of the subject-matter insured; or 
  (b) in the case of a valued policy, the value of the subject-matter insured specified by the policy. 
  
  ### Total loss
  
  67 Subject to this Act and any express provision in the policy, the measure of indemnity in respect of a total loss of the subject-matter insured is 
  (a) in the case of an unvalued policy, the insurable value of the subject-matter; and 
  (b) in the case of a valued policy, the value of the subject-matter specified by the policy. 
  
  ### Partial loss of ship
  
  68 Subject to any express provision in the marine policy, the measure of indemnity in respect of a partial loss of a ship is 
  (a) where the ship is repaired, the reasonable cost of the repairs less the customary deductions, but not exceeding the sum insured in respect of any one casualty; 
  (b) where the ship is partially repaired, the aggregate of the reasonable cost of the repairs, as determined under paragraph (a), and the reasonable depreciation, if any, arising from the unrepaired damage, the aggregate not exceeding the cost, as determined under paragraph (a), of repairing the whole damage; and 
  (c) where the ship is not repaired and is not sold in a damaged state during the risk, the reasonable depreciation arising from the unrepaired damage, but not exceeding the cost, as determined under paragraph (a), of repairing the damage. 
  
  ### Partial loss of freight
  
  69 Subject to any express provision in the policy, the measure of indemnity in respect of a partial loss of freight is that proportion of the insurable value of the freight, in the case of an unvalued policy, or the value of the freight specified by the policy, in the case of a valued policy, that the part of the freight lost by the insured bears to the whole freight at the risk of the insured under the policy. 
  
  ### Partial loss of goods or movables
  
  70 (1) Subject to any express provision in the policy, the measure of indemnity in respect of a partial loss of goods or movables is 
  (a) where part of the goods or movables insured by an unvalued policy is totally lost, the insurable value of the part lost, ascertained as in the case of a total loss; 
  (b) where part of the goods or movables insured by a valued policy is totally lost, that proportion of the value of the goods or movables specified by the policy that the insurable value of the part lost bears to the insurable value of all the goods or movables, ascertained as in the case of an unvalued policy; and 
  (c) where the whole or any part of the goods or movables is delivered damaged at its destination, that proportion of the insurable value of all the goods or movables, in the case of an unvalued policy, or the value of all the goods or movables specified by the policy, in the case of a valued policy, that the difference between the gross value of all the goods or movables in a sound condition at that destination and their gross value in their damaged condition at that destination bears to the gross value of all the goods or movables in a sound condition at that destination. 
  
  ### Definition of “gross value”
  
  (2) For the purposes of paragraph (1)(c), 
  *gross value*  
  (a) in the case of goods or movables customarily sold in bond, means the bonded price of the goods or movables; and 
  (b) in the case of any other goods or movables, means the wholesale price, or if there is no wholesale price, the estimated value, of the goods or movables, together with any freight, landing charges and duty paid in respect of them. 
  
  ### Gross proceeds
  
  (3) For the purposes of paragraph (1)(c), where the goods or movables are sold at their destination and all charges on the sale are paid by the sellers, their gross value in their damaged condition at that destination is the actual price obtained for them, which price is known as the gross proceeds. 
  
  ### Apportionment of specified value
  
  71 (1) In determining the measure of indemnity under a valued policy that specifies a single value for different types of goods, 
  (a) the value must be apportioned to those types in proportion to their respective insurable values, as determined under this Act; and 
  (b) the value of any part of any type of the goods is that proportion of the value of all the goods of that type that the insurable value of that part bears to the insurable value of all the goods of that type, as determined under this Act. 
  
  ### Idem
  
  (2) Where the insurable value of goods cannot be determined for the purposes of subsection (1) because the prime cost of a type of goods is not ascertainable, the value specified by the valued policy may be apportioned to the different types of goods in proportion to their respective net arrived sound values. 
  
  ### General average contribution
  
  72 (1) Subject to any express provision in the marine policy, the measure of indemnity in respect of a general average contribution that an insured has paid or is liable to pay is 
  (a) where the subject-matter of the contribution is fully insured for its contributory value, the full amount of the contribution; and 
  (b) where the subject-matter of the contribution is not fully insured for its contributory value or only part of it is insured, that proportion of the full amount of the contribution that the insured value of the subject-matter bears to its contributory value. 
  
  ### Idem
  
  (2) In order to determine the measure of indemnity under paragraph (1)(b) in a case where a particular average loss that is to be deducted from the contributory value has been incurred and is payable by the insurer, the amount of the loss must be deducted from the insured value of the subject-matter. 
  
  ### Salvage charges
  
  (3) Where salvage charges are recoverable under a marine policy, the measure of indemnity in respect of the charges is to be determined in accordance with the principles set out in subsections (1) and (2). 
  
  ### Third party liability
  
  73 Subject to any express provision in the policy, the measure of indemnity in respect of any liability to a third party that is expressly insured against by a marine policy is the amount paid or payable by the insured to the third party in respect of the liability. 
  
  ### Other losses
  
  74 The measure of indemnity in respect of a loss not provided for in any of sections 67 to 73 is to be determined, as much as possible, in accordance with those sections. 
  
  ### Proportional liability
  
  75 Where a loss is recoverable under a marine policy, the insurer, or each insurer if there is more than one, is liable for that proportion of the measure of indemnity in respect of the loss that the amount subscribed by the insurer is of 
  (a) in the case of an unvalued policy, the insurable value of the subject-matter; and 
  (b) in the case of a valued policy, the value of the subject-matter specified by the policy. 
  
  ### Construction
  
  76 Nothing in sections 66 to 75 shall be construed as affecting the provisions of this Act relating to double insurance or prohibiting an insurer from disproving an interest in whole or in part or from establishing that, at the time of a loss, the whole or any part of the subject-matter insured was not at risk under the marine policy. 
  
  ### Particular average warranties
  
  77 (1) Where the subject-matter insured under a marine policy is warranted free from particular average, the insured cannot recover for a loss of part of the subject-matter, other than a loss incurred by a general average sacrifice, unless the contract evidenced by the policy is apportionable, in which case the insured may recover for a total loss of any apportionable part. 
  
  ### Idem
  
  (2) Where the subject-matter insured under a marine policy is warranted free from particular average, either wholly or under a specified percentage, the insurer is nevertheless liable for salvage charges and, if the policy contains a sue and labour clause, for particular charges and other expenses properly incurred under the clause for the purpose of averting a loss by a peril insured against. 
  
  ### Addition of general to particular average loss
  
  (3) Unless the policy otherwise provides, where the subject-matter insured under a marine policy is warranted free from particular average under a specified percentage, a general average loss cannot be added to a particular average loss in order to attain that percentage. 
  
  ### Calculation of percentage
  
  (4) Where the subject-matter insured under a marine policy is warranted free from particular average under a specified percentage, for the purpose of determining whether that percentage has been attained, only the actual loss incurred in respect of the subject-matter may be considered, and no particular charges or expenses incurred in establishing the loss may be included. 
  
  ### Recovery of successive losses
  
  78 (1) Subject to this Act and unless the marine policy otherwise provides, an insurer is liable for successive losses, even if the total amount of the losses exceeds the sum insured. 
  
  ### Exception
  
  (2) Where, under a marine policy, a partial loss that has not been repaired or otherwise made good is followed by a total loss, the insurer is liable only for the total loss. 
  
  ### Liability under sue and labour clause
  
  (3) Nothing in subsections (1) and (2) shall be construed as affecting the liability of an insurer under a sue and labour clause. 
  
  ### Sue and labour clause
  
  79 (1) Where a marine policy contains a sue and labour clause, the engagement thereby entered into is supplementary to the contract and the insured may recover from the insurer any expenses properly incurred under the clause, even if the insurer has paid for a total loss of the subject-matter insured or the subject-matter insured is warranted free from particular average, either wholly or under a specified percentage. 
  
  ### Idem
  
  (2) General average losses, general average contributions, salvage charges, and expenses incurred for the purpose of averting or diminishing a loss by a peril not insured against are not recoverable under a sue and labour clause. 
  
  ### Duty to avert or diminish loss
  
  80 It is the duty of an insured and an insured’s agent to take such measures as are reasonable for the purpose of averting or diminishing a loss under the marine policy. 
  
  ## Rights of Insurer on Payment 
  
  ### Subrogation where total loss
  
  81 (1) On payment by an insurer for a total loss of the whole of the subject-matter insured or, if the subject-matter insured is goods, for any apportionable part of the subject-matter insured, the insurer becomes entitled to assume the interest of the insured in the whole or part of the subject-matter and is subrogated to all the rights and remedies of the insured in respect of that whole or part from the time of the casualty causing the loss. 
  
  ### Subrogation where partial loss
  
  (2) On payment by an insurer for a partial loss of the subject-matter insured, the insurer acquires no title to the subject-matter but is subrogated to all the rights and remedies of the insured in respect of the subject-matter from the time of the casualty causing the loss to the extent that the insured is indemnified, in accordance with this Act, by the payment for the loss. 
  
  ## Return of Premium 
  
  ### Recovery or retention
  
  82 (1) A premium or part of a premium that is returnable to the insured may, if paid, be recovered by the insured from the insurer and may, if not paid, be retained by the insured or the insured’s agent. 
  
  ### When premium returnable
  
  (2) A premium or part of a premium is returnable to the insured in any of the circumstances described in sections 83 to 85. 
  
  ### Return on happening of specified event
  
  83 Where a marine policy contains a provision for the return of the premium or part of the premium on the happening of a specified event, the premium or part is returnable to the insured on the happening of that event. 
  
  ### Return on total failure of consideration
  
  84 (1) Where the consideration for a premium totally fails and there is no fraud or illegality on the part of the insured or the insured’s agent, the premium is returnable to the insured on the failure. 
  
  ### Idem
  
  (2) Where any apportionable part of the consideration for a premium totally fails and there is no fraud or illegality on the part of the insured or the insured’s agent, a proportionate part of the premium is returnable to the insured on the failure. 
  
  ### Particular circumstances
  
  85 (1) Without limiting the generality of section 84, a premium or part of a premium is returnable or not returnable to the insured in the particular circumstances described in subsections (2) to (11). 
  
  ### Void or avoided marine policy
  
  (2) Where a marine policy is void, or is avoided by the insurer as of the commencement of the risk, and there is no fraud or illegality on the part of the insured or the insured’s agent, the premium is returnable. 
  
  ### Exception
  
  (3) Where the risk is not apportionable and has once attached, subsection (2) does not apply and the premium is not returnable. 
  
  ### Subject-matter never imperilled
  
  (4) Where the subject-matter insured or part of the subject-matter insured has never been exposed to any peril insured against, the premium or a proportionate part of the premium, as the case may be, is returnable. 
  
  ### Exception
  
  (5) Where the subject-matter is insured “lost or not lost” and has arrived at its destination safely before the contract is concluded, subsection (4) does not apply and the premium is not returnable unless, at the time the contract is concluded, the insurer knows of the safe arrival. 
  
  ### No insurable interest
  
  (6) Where an insured has no insurable interest throughout the period of the risk, the premium is returnable. 
  
  ### Exception
  
  (7) Subsection (6) does not apply in respect of a contract by way of gaming or wagering and the premium is not returnable. 
  
  ### Over-insurance under one policy
  
  (8) Where an insured is over-insured under an unvalued policy, a proportionate part of the premium is returnable. 
  
  ### Defeasible interest
  
  (9) Where an insured has a defeasible interest in the subject-matter insured that is terminated during the period of the risk, the premium is not returnable. 
  
  ### Over-insurance under several policies
  
  (10) Subject to subsections (2) to (9), where an insured is over-insured by double insurance, a proportionate part of the premiums is returnable. 
  
  ### Exceptions
  
  (11) Subsection (10) does not apply 
  (a) where the double insurance is knowingly effected by the insured, in which case none of the premiums is returnable; and 
  (b) where the policies are effected at different times and either the earlier policy has at any time borne the entire risk or a claim has been paid on the earlier policy in respect of the full sum insured by it, in which case the premium for the earlier policy is not returnable and the premium for the later policy is returnable. 
  
  ## Double Insurance 
  
  ### Double insurance where over-insured
  
  86 (1) An insured is over-insured by double insurance if two or more marine policies are effected by or on behalf of the insured on the same marine adventure and interest or part thereof and the sums insured exceed the indemnity allowed by this Act. 
  
  ### Where over-insurance
  
  (2) An insured who is over-insured by double insurance 
  (a) may claim payment from the insurers in any order, unless the marine policy under which the claim is made provides otherwise, but may not receive more than the indemnity allowed by this Act; 
  (b) if claiming under a valued policy, shall give credit, as against the value specified in the policy, for any sum received by the insured under any other policy without regard to the actual value of the subject-matter insured; 
  (c) if claiming under an unvalued policy, shall give credit, as against the full insurable value, for any sum received by the insured under any other policy; and 
  (d) is deemed to hold any sum received in excess of the indemnity allowed by this Act in trust for the insurers, according to their right of contribution among themselves. 
  
  ### Right of contribution
  
  87 (1) Where an insured is over-insured by double insurance, each insurer is liable, as between the insurer and the other insurers, to contribute rateably to the payment of a loss in proportion to the amount for which the insurer is liable under the insurer’s contract. 
  
  ### Remedies for overcontribution
  
  (2) An insurer who contributes more to the payment of a loss than required by subsection (1) is entitled to bring an action against the other insurers for contribution and to such other remedies as a surety is entitled to for paying more than the surety’s proportion of a debt. 
  
  ## Under-insurance 
  
  ### Under-insurance
  
  88 Where an insured is insured for a sum that is less than the insurable value of the subject-matter insured, in the case of an unvalued policy, or less than the value of the subject-matter insured specified by the policy, in the case of a valued policy, the insured is deemed to be self-insured in respect of the uninsured difference. 
  
  ## Mutual Insurance 
  
  ### Mutual insurance
  
  89 (1) Mutual insurance is insurance whereby two or more persons mutually agree to insure one another against marine losses. 
  
  ### Application of Act
  
  (2) Subject to subsections (3) and (4), this Act applies in respect of mutual insurance. 
  
  ### Premium
  
  (3) The provisions of this Act relating to premiums do not apply in respect of mutual insurance, but a guarantee, or such other arrangement as may be agreed on, may be substituted for the premium for mutual insurance. 
  
  ### Amendment by mutual insurance association
  
  (4) The provisions of this Act may, in the case of mutual insurance effected by an association, be modified by a marine policy issued by the association, or by the rules and regulations of the association, to the extent that the provisions may be modified by agreement of the parties to the insurance. 
  
  ## General 
  
  ### Exclusion or variation of rights, duties or liabilities
  
  90 Any right, duty or liability that arises under a contract by implication of law, or that is established by this Act and may be lawfully modified by the parties to a contract, may be negated or varied by express agreement or by usage of the trade if the usage binds both parties to the contract. 
  
  ### Question of fact
  
  91 Any question as to what constitutes a reasonable time, a reasonable premium or reasonable diligence for the purposes of this Act is a question of fact. 
  
  