Valued and Unvalued Policies in Marine Insurance
How a valued policy fixes the insured value under MIA 1906 s.27, how an unvalued policy is measured under s.16 and s.28, and the CTL exception.
A valued policy specifies the agreed value of the subject-matter insured, and under the Marine Insurance Act 1906 s.27(3) that value is, absent fraud, conclusive between insurer and assured whether the loss is total or partial. An unvalued policy leaves the insurable value to be ascertained under s.28, using the default measures in s.16.
The full article will cover the s.27(4) rule that the agreed value is not conclusive for the constructive total loss test, overvaluation as a material circumstance, the insurer’s right to disprove interest under s.75(2), hull and cargo valuation practice, and the equivalent rules in the 2025 PRC Maritime Code. The cargo insured value article covers how this topic affects the sum insured on a cargo policy.