Best Trade Solution

Hi!

Please, kindly advise me of the following:

Under L/C an Insurance Policy/Certificate is required.
It is a special condition that it must be issued to the order of the named bank (issuing bank).
The insurance company is not able to issue the Insurance Certificate directly To the order of the named bank (issuing bank).
So the Insurance Certificate will be issued in the following way:

Insurer: Insurance Company
Insured: Beneficiary of the L/C
Beneficiary: To the order of the named bank (issuing bank)

And my question is whether the Beneficiary of the L/c shall endorse the Insurance Certificate To the order of the named bank (issuing bank).

Yours faithfully,

Alexander Maly

Hi Would really need to see the relevant text of the LC before answering. Welcome comments of other members. Ravi

WORDING OF THE RELEVANT DOCUMENTS':

- FULL SET OF 'CLEAN ON BOARD' MARINE BILLS OF LADING MARKED
'LINER TERMS' ISSUED TO THE ORDER OF: ABC BANK (ISSUING BANK),
MARKED 'FREIGHT PREPAID' NOTIFY APPLICANT, EVIDENCING SHIPMENT
FROM ANY EUROPEAN SEAPORT TO ANY SEAPORT IN ABC BANK (COUNTRY OF THE ISSUING BANK).

- INSURANCE POLICY/CERTIFICATE ESTABLISHED TO THE ORDER OF ABC BANK (ISSUING BANK)
IN THE ABC BANK COUNTRY IN THE CURRENCY OF THE LETTER OF
CREDIT, CLAIM PAYABLE IN ABC BANK COUNTRY AT LEAST 110 PERCENT OF
THE CIF VALUE OF THE GOODS, COVERING:
INSTITUTE OF CARGO CLAUSES 'A', INSTITUTE OF STRIKES, RIOT AND
CIVIL COMMOTION, INSTITUTE OF WAR CLAUSES, THEFT, PILFERAGE AND
NON DELIVERY AND TRANSSHIPMENT RISKS COVERING AT LEAST BETWEEN
THE PLACE OF TAKING IN CHARGE OR SHIPMENT AND THE PLACE OF
DISCHARGE OR FINAL DESTINATION AS STATED IN THE CREDIT.
(INSURANCE POLICY/CERTIFICATE TO INDICATE THE NAME AND ADDRESS
OF THEIR APPOINTED AGENT/REPRESENTATIVE IN ABC BANK COUNTRY FOR
ANY CLAIM(S)).

Hi Pals,

I think that case 6 opinion R778/TA688 is aplicable, the insured (l/c Beneficiary) must sign the endorsement: to the order of issuing bank, otherwise the endorsement is not valid.
Other comments appreciated
Ciao

Hi!

Thank you very much for your kind attention.
I have the same opinion but it's always helpful to check it with others.

Alex

As an applicant of an LC to China, the LC which was issued has a defaulted word "irrespective of percentage" in its insurance clause. The beneficiary is asking for the word to be deleted but the issuing bank refused to do so with no reason given except that it is a defaulted clause in all their LC. What could be the downside to me if we were to agree on the request and what should my reasoning be to the issuing bank to take on my request for the deletion and amendment? Appreciate your comment.

Mokhlis

Hi Pals,

please read ISBP 745v para K14: irrespective of percentage means that the insurance document should not indicate that the cover is subject to a franchise or excess(deductible) as per art. 28 j. UCP 600. An insurance document not showing franchise or deductible is accepted even if not claused
"irrespective of percentage". So if deleted, you may receive a document that foresee a franchise or a deductible, usually little amount.
Ask your insurer?
Comments appreciated
Ciao