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Marine cargo (goods in transit)

Details of the risk

  • The insured is resident in Hong Kong. 
  • The insured’s goods are going to be in transit by sea from Hong Kong to South Korea.

For marine cargo risks, the risk location may be determined by the following factors: 

  • The country/territory in which the insured is resident, or its establishment is situated, and 
  • Where the goods are physically situated or being transported to and from.

Whether or not a factor is relevant will be dependent on the countries/territories identified. 


Hong Kong:

Under the Insurance Ordinance (Chapter 41), a risk is deemed to arise in Hong Kong, for specific classes of business, where there is: 

  • An insured in Hong Kong. 
  • A risk located in Hong Kong. 
  • A policy proposed, issued, signed, accepted, submitted or received in Hong Kong. 

In the case of goods in transit business, a risk is deemed to arise in Hong Kong if it is underwritten in Hong Kong as described in the definition of Hong Kong insurance business. 

As the policy will be issued to the insured who is resident in Hong Kong this would fall within the definition of Hong Kong insurance business. Therefore, under the Insurance Ordinance, the risk is deemed to arise in Hong Kong. 

South Korea:

A risk is deemed to be a South Korean risk where the insured is a South Korean resident, as defined under the Foreign Exchange Transactions Act. This is an individual whose address or place of residence is within South Korea or a company whose main office is within South Korea. 

As the definition of risk location for South Korea does not include the physical location of goods, i.e. moveable property, a regulatory risk location does not arise in South Korea. Therefore, in this scenario there is a single regulatory risk location, and this arises in Hong Kong. As such, the contract will be subject to the regulatory regime in Hong Kong. This risk must be written by Lloyd’s underwriters using their syndicate stamp.