Article 306 of the Saudi Commercial Maritime Law
المادة 306 من النظام البحري التجاري · الفصل الأول: الأحكام العامة
The article sets what the insurer is liable for: physical damage from a maritime risk or force majeure that the insurance covers, the insured property's share in general average losses, and expenses to protect it from damage or reduce it.
Official text (Arabic)
This article has not been amended since the law was issued.
يسأل المؤمِّن عما يأتي:
1- الأضرار المادية التي تلحق الأشياء المؤمن عليها بسبب وقوع خطر بحري أو حادث يعد قوة قاهرة إذا كان الخطر أو الحادث مما يشمله التأمين.
2- حصة الأموال المؤمن عليها في الخسائر البحرية المشتركة, ما لم تكن ناشئة عن خطر مستثنى من التأمين.
3- المصروفات التي تنفق بسبب خطر مؤمن منه لحماية الأموال المؤمن عليها من ضرر مادي أو للحد منه.
This is the official Arabic wording, the only legally binding version. We do not translate the law itself; the explanation below is ours. Official source: Bureau of Experts at the Council of Ministers
Article 306 explained in plain English
This article sets out the scope of the insurer's liability. He is liable for three things:
- Physical damage to the things insured caused by a maritime risk or an incident that is force majeure, provided the risk or incident is one the insurance covers.
- The share of the insured property in general average maritime losses, unless they arise from a risk excluded from the insurance.
- Expenses incurred because of an insured risk, to protect the insured property from physical damage or to reduce it.
Under Article 1, maritime risks are unexpected incidents that may occur and that relate to a sea voyage. General average maritime losses are the sacrifice or extraordinary expenses decided by the master for the sake of general safety to avoid an imminent danger.
Note that the third item encourages the insured to take protective measures, because their expenses are covered if they arise from an insured risk. Article 305 regulates multiple insurance contracts, while Article 307 deals with the insurer's liability for damage resulting from the fault of the insured, his subordinates, or the master and crew.
Practical example
A merchant insured a shipment bound for Jeddah. A storm occurred and the master ordered part of the cargo to be thrown overboard, and the merchant bore a share in the general average loss, and also spent a sum to dry some wetted goods to limit their spoilage. The insurer is liable for the goods' share in the general average unless it arises from an excluded risk, and for the drying expenses because they were incurred because of an insured risk.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
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Frequently asked questions about Article 306 of the Saudi Commercial Maritime Law
What does maritime insurance cover?
Physical damage from a maritime risk or force majeure that the insurance covers, the insured property's share in general average losses unless it arises from an excluded risk, and expenses incurred because of an insured risk to protect it from damage or reduce it.
Does the insurance cover the costs of protecting the goods?
Yes, if they were incurred because of an insured risk to protect the insured property from physical damage or to reduce it.
More articles on Marine Insurance
- Article 139
Ships carrying the Kingdom's nationality are not permitted to sail to areas dominated by the dangers of war, piracy or armed robbery until proof of insurance of their crew against these dangers is provided.
لا يصرح للسفن التي تحمل جنسية المملكة بالسفر إلى المناطق التي تغلب عليها أخطار الحرب, أو أعمال القرصنة أو السطو المسلح, إلا بعد تقديم مالكها أو مجهزها أو مستأجر
- Article 215
Any agreement made before the incident that exempts the carrier from liability for loss of or damage to the goods, alters the burden of proof placed on him, or assigns to him the rights arising from cargo insurance is void.
يقع باطلاً كل اتفاق يتم قبل وقوع الحادث الذي نشأ عنه الضرر, ويكون موضوعه أحد الأمور الآتية: 1- إعفاء الناقل من المسؤولية عن هلاك البضائع أو تلفها. 2- تعديل عبء
- Article 236
The carrier must hold insurance or a guarantee from a recognized body covering its liability for death and bodily injury, and the injured party may claim directly against the insurer or guarantor.
يجب أن يكون لدى الناقل تأمين أو ضمان من جهة معترف بها، لتغطية مسؤوليته عن الوفاة والإصابات البدنية. وفي هذه الحالة يجوز للمتضرر الرجوع المباشر على المؤمن أو الض
- Article 293
The article provides that the maritime insurance provisions apply to an insurance contract covering maritime risks, without prejudice to the Law on Supervision of Cooperative Insurance Companies.
دون إخلال بالأحكام الواردة في نظام مراقبة شركات التأمين التعاوني, تسري أحكام هذا الباب على عقد التأمين الذي يكون موضوعه تغطية الأخطار البحرية.
- Article 294
The article requires a maritime insurance contract and any change to it to be proved in writing, sets the particulars of the insurance policy, and makes a provisional policy binding on both parties until the final policy is issued.
1- لا يثبت عقد التأمين وكل ما يطرأ عليه إلاَّ بالكتابة. 2- يصدر بموجب عقد التأمين وثيقة تأمين تتضمن البيانات الآتية: أ- تاريخ عقد التأمين ومكانه. ب- اسم المؤمِّ
- Article 295
The article allows a maritime insurance policy to be issued in the name of the insured, to his order or to bearer, and gives its lawful holder the right to claim compensation, subject to the insurer's defenses against the insured.
1- تكون وثيقة التأمين باسم المؤمن له أو لأمره، أو لحاملها. 2- يكون لحامل الوثيقة الشرعي الحق في المطالبة بالتعويض, وللمؤمِّن أن يحتج في مواجهته بالدفوع التي يجو
The texts are reproduced from the official website of the Bureau of Experts at the Council of Ministers for reference; where they differ, the officially published Arabic text prevails. This content is not legal advice.