Topic 1 Principle of Subrogation in Marine Insurance Law Subrogation in Marine Insurance Law – A critical evaluation Academic Essay

Abstract

In the conduct of day to day operations of man, whether it is on a personal or business level, instances where there is exposure to risk are inevitable. Whether it is an unexpected disaster like fire, or an act of theft, at one time or another, there are chances that an entity is bound to fall victim to one form of risk or another. In that context, therefore, the concept of insurance works in such a way that it helps entities manage risks by offering compensation to an insured suffering from any of the previously insured risks[1].

In this regard, from a legal perspective, there are many branches of insurance, with Marine insurance law being among the prominent ones. Marine insurance is the category of cover over vessels and equipment such as ships, harbors as well as cargo terminals that use the water for commercial purposes, and encompasses the onshore as well as offshore goods. Should there be any undue damage or loss of property that is insured under marine insurance aboard a vessel, there will be due compensation from the insurer. However, the assured party equally has the choice of instituting legal proceedings for compensation from a third party that occasioned the loss, and thereby have a double benefit. In this context, the principle of subrogation in comes in, ensuring that there is no such undue advantage on the part of the assured[2].

In marine insurance law, the subrogation principle works in much the same manner. The proposal is, therefore, an critical evaluation of the policy of marine insurance law. There will be a collection of data on the subject matter for this particular purpose, looking at the level of mischief that parties in this sector of insurance are in a position to engage in, and the possible avenues that will be appropriate for sealing any of the loopholes. The information will be collected by way of both qualitative and quantitative analysis methods of data collection. Among the possible outcomes will be an identification of the scope application and relevance of the principle, the extent of instances of unfair double benefit from the insured parties, whether the current legal provisions are responsive enough and the possible areas for improvement.

The Problem Questions

Is the current application of the principle of subrogation in marine insurance law relevant and responsive?

In the evaluation of the principle of subrogation in marine insurance law, there will be a thorough analysis of the concept, how it applies to the present setup, and whether it is successful in attaining what framers of the law intended. Besides, there will be an interrogation of the relevance of the principle in consideration of the passage of time over the years, looking into whether there is the need for amendments that will enable the law to catch up with recent developments[3].

Is there the need for reform?

Once there has been an objective, research-based evaluation of the level and scope of the applicability of subrogation in marine insurance law, there will be a flagging of the areas that present the biggest obstacles in the effort to confront the mischief that is meant to be aIDressed by the principle. The step that will then follow will be to structure the narrative in such a manner that will look into the question as to whether there will be a need for reform of the law so that it is better placed to offer the necessary legal cover[4].

Background

The relevance of the problem questions: Why these problem questions?

A quick glance at the marine insurance law in general reveals that the industry is one of the most capital intensive, but risk-fraught segments of business today. Each passing day, there are a countless number of activities related to the marine industry, especially for commercial purposes. In this context, all of these activities involve significant investments from the relevant stakeholders, and inevitably, there is bound to be an incurring of insurable loss in the process. For this reason, the insurers are on a daily basis called upon to pay out compensation to affected parties[5]. However, some of the insured parties have taken advantage and separately sought payment from third parties that occasion the loss, and as a result, they benefit twice. It is critical that there is a legal regime that sufficiently protects the insurer from falling victim to such malicious action. It is important that there is an evaluation of the current law relating to this area so that any loopholes can be identified, and a solution prescribed to offer a long-term solution.

Is there similar research on the problem questions?

A study of the academic research in this area reveals that there has been the study that has touched on some aspects of marine insurance law and regulations, but no substantial research that has the focus on the particular area of subrogation[6]. Indeed, there are academic studies that aIDress the principles of insurance regarding the maritime law, but it is worth noting that the specific area of subrogation in maritime law has minimal research. In this regard, the problems that are raised in this proposal are ones that have received minimal attention. The future study to be carried out, therefore, will provide much-needed depth in understanding the subrogation in its particular aspects in marine insurance law.

Methods Used

The previous work that has a bearing on the subject matter that the problem questions in this proposal will aIDress used the research methodology of qualitative research to the exclusion of any other methods[7]. The authors focused their research process on this particular format in arriving at their findings.

The conclusions of the previous studies.

An analytic look at the previous research into this area of subrogation in marine insurance law shows that there were conflicting findings; spread out in two broad thematic areas[8]. On the one hand, there is the arm of conclusions that concludes that there is sufficient basis for reform of the law governing marine insurance in an overall sense, placing all the major principles in one basket[9]. Alternatively, there is the school of thought that emerges, suggesting that the current provisions as they currently stand, offer the requisite legal cover for the relevant parties[10].

The research that this paper intends to conduct is, therefore, relevant in context with the previous findings in the following manner. There is the absence of investigation that has been done with findings that narrow down the scope to the relevance of subrogation in marine insurance law.

Research Design

Research Limitation

In conducting this study, there are some possible areas that can be evaluated, all with the probability of producing the desired results in differing levels. The area of subrogation in marine insurance law is broad and complex, with a myriad of conflicting, inter-related concepts[11]. Without a conscious and deliberate effort to limit narrow down the scope of analysis, there is the inherent danger of falling short in arriving at findings that will be specific in aIDressing the problem questions. In this regard, this thesis will restrict itself to the problem questions, only dealing with an evaluation and thorough overview of the issues emerging in this connection, with only the minimum inevitable inference to matters beyond[12].

The Information and data required

In the conducting of the research in this thesis, there will be the significant amount of data that will be used for comprehensive, objective and credible findings. The statistical data will focus and be guided by the problem questions. The data I will need for this thesis will be accurate and tailored to fit the specific issues. The data has to be from direct sources for purposes of credibility and objectivity and as recent as possible, bearing the most accurate possible reflection of the state of affairs.

It will be critical to making use of historical information concerning the problem questions so that there can be a comparative analysis that will enrich the study, providing it with the necessary depth and range.

Data collection methodology

In the conducting of the research, there will be the use of various methods of data collections. I will employ the use of qualitative data collection method. In this, I will conduct interviews with relevant sources so that there can be a retrieval of the most accurate and updated information for the thesis. Through the utilization of theoretical sampling, there will be a systematic selection of the interviewees so that there can be the most optimum results.

The area of subrogation in marine insurance law though one that remains relatively under-researched, still has a significant level of coverage in publications and journals[13]. These will be areas of information collection I will utilize. The thorough examination of the legal provisions and policies in this area will be another data mine that I will make full use of, aiming to extract the relevant knowledge and information that will inform the thesis.

I will avoid the use of observational and ethnographic data collection methods for the reason that the sources are unlikely to open up due to the sensitivity around the subject due to the illegality aspect of fraud.

Expected Outcomes

The problem questions identified for the purpose of this essay are broad enough to the extent that they sufficiently aIDress a significant portion of the issues in subrogation in marine insurance law. The critical aspect that will enable comprehensive, all-encompassing and sustainable findings, capable of wide-ranging and long-term application is an accurate analyzing of data. There will be the considerable amount of data that will be collected from various sources all for the purpose of providing answers to the problem questions.

I will conduct the analysis of this data in a systematic, organized format that will flow the information beginning with the historical perspective and come down to the contemporary issues arising in subrogation[14]. In this manner, there will be an organized flow that will bring out the sticking points and lead to the expected results.

Results expected

Having collected sufficient information from all the various relevant sources, I will conduct a detailed, comprehensive and objective analysis and evaluation of the problem questions in the wider area of subrogation in marine insurance law after which I will scale it down. The thesis will make generalizations, working with assumptions that will guide the process and give a wider scope of the problem. In this regard, there will be the inevitable assertions that will be made and these will be defended so that the problem questions will not only be answered but given sufficient context. The result will be findings that will pass the test of objectivity and rationality.

Since the problems identified will continually be providing the guidance necessary, the thesis will stay within the limits set, so that there will be a more deliberate effort in the identification of the solutions from the data available. Before arriving at the conclusions, the thesis will be keen to examine all the possible outcomes, outside the expected results, so that there can be a wider scope of analysis.

For purposes of establishing credibility, the thesis will take a critical angle, scrutinizing and presenting all the generalizations and different results. It will be imperative to relate the findings of previous studies in this area, so that whatever answers and solutions arrived at in the end will be acceptable as meeting the threshold of integrity.

In the end, the expected results will be that the topic of subrogation in marine insurance law, will finally have a conclusive and comprehensive research and study, one that will apply to a logical point of reference for future studies[15]. There will be an enrichment of the whole marine insurance space as a whole, thanks to the findings of this thesis.

References

BENNETT, Howard N, The Law Of Marine Insurance (Oxford, 2006)

BIRDS, John, and John Birds, Birds’ Modern Insurance Law (London, 2010)

BIRDS, John, “Landlords, Tenants And Subrogation”, Oxford Journal Of Legal Studies, 6/2 (1986), 304-310

CHESLER, Robert D., Lynda A. Bennett, and Christopher D. Hopkins, “An Insurer’s Obligation To Provide A Quality Defense: An Analysis Of Insurer Litigation Guidelines”, Environmental Claims Journal, 13/3 (2001), 5-20

CLARKE, Malcolm A, Policies And Perceptions Of Insurance Law In The Twenty-First Century (Oxford, 2005)

GURSES, Ozlem, Marine Insurance Law ([S.l.], 2016)

HASSON, Reuben, “Subrogation In Insurance Law— A Critical Evaluation”,Oxford Journal Of Legal Studies, 5/3 (1985), 416-438

H Klopper, “The Qualitative Research Proposal”, Curationis, 31/4 (2008).

H., R. W., and Arthur BiIDle, “A Treatise On The Law Of Insurance (Excepting Marine Insurance)”, Harvard Law Review, 7/4 (1893), 246

MACGILLIVRAY, Evan James, Nicholas Legh-Jones, and Evan James MacGillivray,Macgillivray On Insurance Law (London, 1997)

MERKIN, Robert, Marine Insurance Legislation (London, 2000)

PECK, Douglas, “Insurance: Subrogation: Group Hospital Service Organization”, Michigan Law Review, 53/3 (1955), 484

ROSE, F. D, Gerard McMeel, and Stephen Watterson, Marine Insurance (London, 2004)

ROSENBERG, David David, “Deregulating Insurance Subrogation: Towards An Ex Ante Market In Tort Claims”, SSRN Electronic Journal

[1] John Birds, Birds’ Modern Insurance Law (London, 2010).

[2] F. D Rose, G. McMeel and S. Watterson, Marine Insurance: Law and Practice (London, 2004).

[3] Robert Merkin, Marine Insurance Legislation (London, 2000).

[4] Howard N Bennett, The Law Of Marine Insurance (Oxford, 2006).

[5] Ozlem Gurses, Marine Insurance Law ([S.l.], 2016).

[6] Evan James MacGillivray, Nicholas Legh-Jones and Evan James MacGillivray, Macgillivray On Insurance Law (London, 1997).

[7] Reuben Hasson, “Subrogation In Insurance Law— A Critical Evaluation”, Oxford Journal Of Legal Studies, 5/3 (1985), 416-438.

[8] R. W. H. and Arthur BiIDle, “A Treatise On The Law Of Insurance (Excepting Marine Insurance)”,Harvard Law Review, 7/4 (1893), 246.

[9] Douglas Peck, “Insurance: Subrogation: Group Hospital Service Organization”, Michigan Law Review, 53/3 (1955), 484.

[10] John Birds, “Landlords, Tenants And Subrogation”, Oxford Journal Of Legal Studies, 6/2 (1986), 304-310.

[11] Malcolm A Clarke, Policies And Perceptions Of Insurance Law In The Twenty-First Century(Oxford, 2005).

[12] H Klopper, “The Qualitative Research Proposal”, Curationis, 31/4 (2008).

[13] Robert D. C, Lynda A. B and Christopher D. H, “An Insurer’s Obligation To Provide A Quality Defense: An Analysis Of Insurer Litigation Guidelines”, Environmental Claims Journal, 13/3 (2001), 5-20.

[14] Nakhyun Han, “A Study On The Implications Of Japanese Subrogation System Under Marine Insurance Contract”, Thejournalofinternationaltradecommerce, 9/4 (2013), 75-97.

[15] David David Rosenberg, “Deregulating Insurance Subrogation: Towards An Ex Ante Market In Tort Claims”, SSRN Electronic Journal.
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