Clarifying the law on constructive total losses


We have been instructed by the Swedish P&I Club (as the leading hull and machinery underwriters) and the following market in a claim for US$15 million brought by the former owners of MV Renos following an engine room fire that took place near Suez in 2012.

The matter reached the Supreme Court in April 2019 in relation to whether pre-notice of abandonment costs can rank towards a constructive total loss and whether SCOPIC costs can rank.

In relation to SCOPIC, the Supreme Court allowed our appeal and clarified that SCOPIC costs do not form part of the calculation of whether or not a vessel is a constructive total loss. This is a significant clarification for the marine insurance market.

Following the Supreme Court’s ruling, the matter has been remitted back to the judge of first instance to assess whether the vessel is a constructive total loss.


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