What does General Average mean? Read on to discover the definition & meaning of the term General Average - to help you better understand the language used in insurance policies.
Marine insurance provision under which damages or expenses incurred by shippers (whose cargo is exposed to a common danger) are shared among them in proportion to the value of their exposed cargo. Such damages or expenses occur by direct harm to the ship and/or to the cargo, or in a course of action to prevent initial or additional harm to them. General-average, like particular-average, is independent of the insurance cover bought for the cargo. Instead, it arises out of the contract between the cargo owner and the ship owner. Now largely replaced by relevant institute cargo clause.
We hope the you have a better understanding of the meaning of General Average.