Question

104. The transit clause does which of the following?

(Choose from the following options)
1. Requires the owner of the vessel to pay additional premiums
2. Allows the coverage to remain in effect until the adventure is terminated
3. Names the points of the voyage
4. Allows the adventure to be terminated at other than the named destination provided prompt notice is given to the insurer

Answer 1

The transit clause allows the coverage to remain active until the voyage represented by 'the adventure' is completed, ensuring continuous protection for transported goods.

Step-by-step explanation:

The transit clause is a provision in marine insurance policies that outlines various conditions related to the voyage or adventure for which the insurance is provided. It is particularly concerned with the period during which the insurance is effective. The correct option that describes what the transit clause does is: Allows the coverage to remain in effect until the adventure is terminated. This means the insurance protection continues until the conclusion of the voyage, notwithstanding potential delays or deviations, provided the stipulated terms within the policy are adhered to.

The clause ensures that goods being transported, such as vehicles, animals, cargo holds, or other items on water transportation like rubber tires or stowaways, are covered throughout the journey, up until arrival at the final destination or until the insured adventure is otherwise terminated.