The basic principle of an insurance contract is that it is an indemnity that is recoverable from the indemnifier or insurer as a loss suffered by the assured under the contract. A marine insurance is a type of insurance where the insurer undertakes to indemnify the assured against marine losses to the extent that is agreed upon

The concept of marine insurance has been dated back to centuries. The questions and law that was concerned with the same took a defined format in the English Marine Insurance Act. Another form of insurance which related to the early marine insurance was the ‘general average’ which meant that the person who suffered damage could be compensated on pro rata basis. This insurance was introduced in order to decrease quarrel between merchant and for their safety. The law relating to marine insurance was codified in the year 1906 by the Marine Insurance Act of 1906 but came into proper force on January 1 st , 1907. This law was brought in order to exclusively deal with all principles that were related to marine insurance.

In the Indian Law, since independence, there has been considerable expansion in the area of shipping in India. Prior to the law related to marine insurance, the general law of contracts covered all disputes related to marine insurance. But it has become a statutory form since the year 1963.

The purpose of marine insurance has been to enable the owner of the ships and the buyer of the goods to operate in their respective areas of excellency. While marine insurance adds up the concept of financial security to the accidents or the probable chances of accidents occurring during the conduct of trade, whether domestic or international.

It is well known that prior to the Indian act od 1963, the courts used to follow the law of the English counter parts, it is, however, not self-efficient and the marine insurance is just a codification of the previous case law and giving appreciation to the past authorities is of utmost impotance and an essential requirement in understanding every section within the act.