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What is the South American Clause and Its Importance in Cargo Policies?
Definition & Meaning
The South American Clause is a specific provision in cargo insurance policies that outlines when coverage for shipments to South America ends. This clause takes precedence over both the Warehouse to Warehouse Clause and the Marine Extension Clauses, ensuring that coverage continues even after the cargo has been discharged from the overseas vessel.
Coverage under the South American Clause concludes under three conditions:
When the cargo is delivered to the final warehouse specified in the policy.
Sixty days after the cargo has been discharged from the overseas vessel.
Ninety days after discharge for shipments transported via the Magdalena River.
Table of content
Legal Use & context
The South American Clause is primarily used in maritime and cargo insurance law. It is relevant for businesses and individuals involved in the transportation of goods to South America. Understanding this clause is crucial for ensuring that shipments are adequately covered during transit and after discharge.
Users can manage their shipping insurance needs through legal templates available on platforms like US Legal Forms, which provide ready-to-use documents drafted by experienced attorneys.
Key legal elements
Real-world examples
Here are a couple of examples of abatement:
Example 1: A company ships electronics to Brazil. The South American Clause applies, ensuring coverage continues until the goods reach the designated warehouse or for up to sixty days after discharge.
Example 2: A shipment of agricultural products is sent via the Magdalena River. Under this clause, coverage extends for up to ninety days after discharge from the vessel. (hypothetical example)
Comparison with related terms
Term
Definition
Key Differences
Warehouse to Warehouse Clause
Covers goods from the point of origin to the final destination.
South American Clause extends coverage after discharge, while Warehouse to Warehouse does not.
Marine Extension Clause
Provides additional coverage for marine transport.
South American Clause specifically applies to shipments to South America and has defined termination points.
Common misunderstandings
What to do if this term applies to you
If you are involved in shipping goods to South America, it's essential to review your cargo insurance policy carefully. Ensure that the South American Clause is included and understand its terms. If you need assistance, consider using US Legal Forms to find templates that can help you manage your shipping insurance effectively. For complex situations, seeking professional legal advice may be necessary.
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