LAHORE: Some insurance companies are found repudiating Marine Cargo Policy claims while challenging jurisdiction of Pakistani courts to hear and decide Marine disputes, said sources.

They said the insurance companies flout the relevant provisions of the insurance law by misusing the exception granted to Marine insurance in connection with the jurisdiction of Pakistani courts.

According to sources, the simple meaning of the said exception is that it is relevant if it is specifically mentioned in the Marine insurance policy that payment can be received or a suit can be filed in any other country but it cannot override such Marine insurance Policy to be tried in Pakistan.

They said the obvious purpose of this exception is to avoid any kind of interference with the normal business of Marine insurance, as such contracts are international in scope and most of the time are for the benefit of the consignee abroad who have option of stipulating clause in the Marine Insurance Policy Mentioning place where such contracts are intended to be carried out between the parties.

But the insurance companies operating in Pakistan enter into a Marine Insurance Policy contract with a local exporting company and repudiate their claims in the case of loss to the consignment during the shipment of the same to a foreign destination and prefer to misinterpret the exception to section 115 of the Insurance Ordinance, 2000 which covers the jurisdictional ambit of Pakistani courts in settling insurance disputes.

The sources said the insurance companies keep on changing goal posts by challenging any such claims at higher forums for decades to avoid timely payment of a claim in case of loss. In addition, a number of technical objections are raised simply to delay the proceedings and linger on the payment of claims by such insurance companies, they added.

Copyright Business Recorder, 2023