Theft pilferage and nondelivery cover under marine policy

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The policy issued under All Risk terms cover theft, pilferage and non delivery of the entire consignment. Since TPND are inbuilt cover under All risk policy, no additional premium is collected for granting such cover.

However, if the policy is issued with named perils only like Institute Cargo Clauses B and Inland Transit ( Rail or Road) Clause B ( Basic cover) only, the policy may be extended to cover TPND by collection of an additional premium.

If TPND cover is granted as an extension of ICC B/ITC B , the Assured is entitled to recover his loss for the missing consignment if the Assured is able to establish that the subject loss was caused due to Theft, pilferage and non delivery only. The policy with the restricted terms may include TPND cover with the following condition “ In consideration of an additional premium, it is hereby agreed that this insurance covers loss of or damage to the subject matter insured caused by theft or pilferage, or by non delivery of an entire package, subject always to the exclusions contained
in this insurance”

The word theft refers to stealing of materials substantially but does not cover pilferage i.e. the secret taking of small quantities. Since the cover “ theft” alone does not cover pilferage i.e. small quantity of material, the drafters of the policy include the cover “pilferage” to make it more clear that the subject clause intends to cover loss of cargo taken unlawfully, whatever the circumstances in which it was stolen.

When non delivery claim will be dealt with, the entire cargo should be non delivered without any trace but if the cargo is traced out, the non delivery claim will not be triggered. The assured will be asked to take delivery of the consignment and if the cargo is found to be damaged, the loss will be quantified by the surveyors nominated by the underwriters. It is important to note that if a package is accidentally left on board the vessel or mis delivered to another, the missing of such consignment will not be considered as non delivery