CLAIMS PAYABLE AT DESTINATION

QUESTION

Credit stated that the “Insurance Policy endorsed in blank, for full CIF value plus at least 10% stipulating Claims payable at destination covering ……” .

Note : Port of discharge : X port, India.

My questions:

1) Does it mean that Insurance documents need to state “with claims payable at destination…….” ?

2) How about If the insurance documents showing shipment to India, the survey agent in India and settlement agents in exporter country? Is it acceptable?

Looking forward to your early reply.

Best regards

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ANSWER

1) Yes. The insurance document presented must show “claims payable at destination” or “claims payable in India” to comply with the LC requirement.

2) It is acceptable in this particular case. The fact that the insurance document indicates settling agent in the beneficiary’s country does not prevent claims from being payable in the applicant’s country.

If the applicant/issuing bank expects to receive an insurance document showing the name and address of the settling agent in their country, it should be so stipulated in the L/C.

Suggested wording for required insurance document:

INSURANCE POLICY COVERING INSTITUTE CARGO CLAUSE (A) INCLUDING WAR AND STRIKE RISK CLAUSES, SHOWING CLAIM SETTLING AGENT IN INDIA (ADDRESS…) …

Best regards,

Mr. Old Man