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Sunday, October 2, 2016

"Not to INURE" clause in Marine Insurance - the benefits.....

When asked to do something, people tend to ask, - what would be the benefit ?

The word benefit has so many meanings in varied circumstances :
• In a Society, benefit is what enhances the community or society at large
• In Economics, it is the increased wealth or ability to satisfy the needs and wants with regard to production, distribution and consumption of goods and services.
• In Insurance parlance, it is the compensation received from an Insurance company – as part of the claim.          

In July 2011, in  dealt with ‘Contranyms’ -  words with an opposite set of meanings.  One word which immediately attracted my attention was “Inure” … We Insurers deal with this quite frequently, especially in Marine Insurance parlance – ‘Inure’ repeat and not ‘Insure’………….

Inure :  Pronunciation : (in-YOOR, i-NOOR) 
verb tr.: To accustom to something unpleasant.
verb intr.: 1. To become beneficial. 2. To take effect.

Etymology : From the phrase in/en ure (in use, customary), from French oeuvre (work), from Latin opera, plural of opus (work). Ultimately from the Indo-European root op- (to work, produce) that is also the ancestor of words such as opera, opulent, optimum, operose, maneuver, and manure. Earliest documented use: 1489.
Notes : The intransitive form of the word is usually used in legal contexts and also spelled as enure.  [thanks to]

In popular dictionary, Inure has the following meanings
•        To take effect or come into use. In property law it can mean to vest. For example the settlement proceeds must inure to the benefit of the widow and children.
•        To make accustomed to something unpleasant. For example abused children become inured to violence.

Those of us dealing with Marine cargo Insurance and who have read Institute Cargo Clauses would strike immediately of the clause wherein it is stated that ‘the policy shall not inure to the benefit of a carrier or other bailee’. The intention is to deny the right of carriers to benefit from the cargo insurance which is intended to cover the risks of the seller or buyer, as the case may be, going by the terms of sale.

Here is the reproduction of the Clause from ICC (A)

Benefit of Insurance :  15. - Not to Inure Clause
“This insurance shall not inure to the benefit of the carrier or other bailee”.   

For years wondered what it could actually mean, now I have some clarity on this ….. one would be happy to note that this is no longer vogue in ICC 2009 clauses.  Here is the comparison….

ICC – 1982 -   (Benefit of Insurance)
15. This insurance shall not inure to the benefit of the carrier or other bailee.

ICC (2009)  - (Benefit of Insurance)
15. This insurance
15.1 covers the Assured which includes the person claiming indemnity either as the person by or on whose behalf the contract of insurance was effected or as an assignee,
15.2 shall not extend to or otherwise benefit the carrier or other bailee.

The new clauses define the Assured with clarity and the utopian ‘inure’ now stands replaced with a plain English wording.

Let the benefits ‘inure’ to all those who read and respond to this post.

With regards – S. Sampathkumar.
19th Nov. 2013.

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