WHETHER A COUNTERSIGNATURE IS TREATED AS AN ENDORSEMENT

QUESTION

Dear Mr Old Man,

Please help me to solve the following problem:

L/C requires Insurance Certificate  to be endorsed in blank.

The Insurance Certificate presented shows:

* This Insurance in event of assignment requires endorsement by the Insured/ Cover Holder (Party A)

* Not Transferable unless countersigned by the Insured

Party A countersigned, but it did not endorse. So is it a discrepancy or not?

I hope to receive your answer soon.

Best regards,

N.

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ANSWER

Hi,

When an insurance document requires a countersignature by the issuer, the assured or a named entity, e.g., This certificate is not valid unless countersigned by:___” , it must be countersigned by the required party to make the certificate valid.

According to ISBP 745, an insurance document is to be in the form required by the credit and, where necessary, be endorsed by the entity to whose order or in whose favour claims are payable. It is to be issued or endorsed so that the right to receive payment under it passes upon, or prior to, the release of the documents.

I come across some insurance policies which state “This Policy is not transferable unless countersigned by an authorized representative of this Company or the Assured AND ENDORSED ON THE SECOND PAGE” or “This Policy is not transferable unless countersigned by an authorized representative of this Company”, but I don’t think the signature that appears in the countersignature place is  an endorsement.

So, you can raise the discrepancy “Insurance certificate not endorsed”

Kind regards,

Mr. Old Man