Article 348 of the Saudi Commercial Maritime Law
المادة 348 من النظام البحري التجاري · الفصل الرابع: التأمين على البضائع
The article estimates losses to goods by the difference between their value damaged and sound at one time and place, and applies the percentage of loss in value to the sum insured.
Official text (Arabic)
This article has not been amended since the law was issued.
تقدر الخسائر التي أصابت البضائع بالفرق بين قيمتها تالفة, وقيمتها سليمة في زمان ومكان واحد، وتطبق نسبة نقص القيمة على مبلغ التأمين.
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 348 explained in plain English
This article sets the method of calculating compensation for damage to insured goods, in two stages:
Stage one: estimating the loss: it is estimated by the difference between the value of the goods damaged and their value sound, provided that both values are measured at one time and place. For example, the price of the goods sound in the country of loading is not compared with their price damaged in the country of arrival.
Stage two: applying the percentage: the percentage of loss in value is derived from stage one, and then applied to the sum insured.
So compensation is not calculated by the direct monetary difference, but by the percentage of loss applied to the sum insured. This keeps the compensation proportionate to what the insured actually insured.
Article 347 sets the ceiling on the sum insured on goods, while Article 349 sets out the cases in which goods may be abandoned to the insurer, including where the goods are lost or damaged to the extent of at least three quarters of their value stated in the policy. To calculate compensation in a particular case, it is advisable to consult a lawyer specialized in insurance.
Practical example
A merchant insures a shipment for SAR 300,000. It arrives damaged, and its value at the port of arrival on the same day is SAR 200,000 sound and SAR 150,000 damaged, a loss of 25%. The compensation is 25% of the sum insured, that is, SAR 75,000.
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 348 of the Saudi Commercial Maritime Law
How is compensation for damaged goods calculated in marine insurance?
The loss is estimated by the difference between their value damaged and sound at one time and place, then the percentage of loss in value is applied to the sum insured.
May the value be compared at two different places?
No, the text requires both values to be at one time and place.
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.