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Report No. 21

Clause 28

Sub-section (1) "To be arranged".-Sub-section (1) provides that where insurance is effected at a premium "to be arranged" and no arrangement is made, a reasonable premium is payable. At first sight, it may appear strange that such an essential factor as the amount of premium is not entered in the policy. The explanation, however, is that very often the assured may desire to obtain immediate cover but may not be in a position to give all the particulars to the insurance company. In such cases, the premium is left to be agreed subsequently. It may be noted that section 23 of the English Act, which gives a list of the particulars to be specified in a policy, does not require that the premium must be noted.

Sub-section (2) "Held covered".-Sub-section (2) deals with a case where an additional premium is to be arranged in a certain event and the event happens but no arrangement is made. Usually, "held covered" provisions are there in many policies. A specimen of such a clause is-"Held covered in case of any breach of warranty as to cargo, trade, locality date of sailing, provided notice be given immediately after receipt of advice and any additional premium required be agreed".

Another example is the Deviation Clause1 included in voyage policy, the material part of which is often as follows:-

"Held covered at a premium to be arranged in case of deviation or change of voyage."

1. As to deviation, see section 46 of the English Act-clause 47.

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