What is the American Clause in Marine Insurance?

Q: Does the American clause apply to all insurance types?

No, it is specific to marine insurance policies.

Q: What types of losses does the American clause cover?

It covers losses due to stranding, sinking, burning, or collision with another vessel.

Definition & Meaning

The American clause is a provision used in marine insurance policies. It prevents an insurer from seeking contributions from a later policy purchased by the insured. This means that if the insured has multiple policies, the insurer cannot claim part of a loss from another insurer if that policy was obtained after the first one. Under this clause, the insurer is not responsible for partial losses unless they result from specific events such as stranding, sinking, burning, or collision with another vessel.

Table of content

Legal Use & context

The American clause is primarily relevant in the field of marine insurance law. It is used to clarify the responsibilities of insurers and the insured in cases where multiple insurance policies are involved. This clause helps prevent disputes over liability and ensures that the insured is protected from having to share losses with later policies. Users can manage their marine insurance needs effectively with legal templates available through US Legal Forms, which are drafted by experienced attorneys.

Key legal elements

Real-world examples

Here are a couple of examples of abatement:

Example 1: A shipping company has two marine insurance policies. If the first policy covers losses from accidents but the second policy is purchased after an accident occurs, the insurer of the first policy cannot seek contribution from the second insurer for the loss.

(hypothetical example)

Comparison with related terms

Term	Definition	Key Differences
American clause	A provision in marine insurance preventing contribution claims from later policies.	Focuses on preventing contribution from subsequent policies.
Other clauses (e.g., English clause)	May allow for contribution claims under certain conditions.	Allows for potential sharing of losses between insurers.

Common misunderstandings

What to do if this term applies to you

If you are involved in marine insurance and have multiple policies, it is essential to understand how the American clause affects your coverage. Review your policies carefully and consult with a legal professional if you have questions about your rights and responsibilities. You can also explore US Legal Forms for templates that can help you manage your insurance needs effectively.

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Quick facts

Attribute	Details
Typical use	Marine insurance policies
Key focus	Preventing contribution claims
Loss types covered	Stranding, sinking, burning, collision

Key takeaways

Frequently asked questions

What is the purpose of the American clause?

It prevents insurers from claiming contributions from later policies purchased by the insured.