Hull & Machinery Insurance

What is Hull & Machinery Insurance?

Hull & Machinery (H&M) insurance is the core property insurance for vessels, providing coverage against physical damage to the ship's hull, machinery, and equipment. It is essential protection for shipowners, operators, and charterers, safeguarding their most valuable maritime assets against a wide range of perils.

H&M insurance typically covers the insured value of the vessel (agreed value) and provides indemnification for repair costs, replacement of damaged equipment, and in extreme cases, total loss compensation. The policy operates on an "all-risks" basis, covering any fortuitous loss or damage not specifically excluded.

Key Policy Elements

Agreed Value: Pre-determined vessel valuation at policy inception
Deductibles: Applied per occurrence to manage premium costs
Navigation Limits: Defined trading areas and seasonal restrictions
Classification Requirements: Vessel must maintain valid class certification

Coverage Details

H&M insurance provides comprehensive protection against a wide range of physical damage perils to your vessel.

Collision Liability

Coverage for damage caused to other vessels or property in collision incidents, including the insured vessel's proportion of liability (typically 3/4 collision liability).

Fire & Explosion

Protection against fire damage, explosions, and related incidents including engine room fires, cargo fires, and spontaneous combustion events.

Weather & Heavy Seas

Coverage for damage caused by heavy weather, storms, hurricanes, typhoons, and extraordinary sea conditions including structural stress damage.

Machinery Breakdown

Coverage for sudden and fortuitous breakdown of main engines, auxiliary machinery, propulsion systems, and other mechanical equipment.

Stranding & Grounding

Protection for damage sustained when a vessel runs aground, strikes underwater objects, or is stranded, including underwater inspection costs.

Contact with Fixed Objects

Coverage for damage from contact with docks, piers, bridges, offshore structures, and other fixed or floating objects.

Lightning & Earthquake

Protection against damage from lightning strikes, earthquakes, and volcanic eruptions affecting the vessel or its equipment.

Jettison & Sacrifice

Coverage for damage caused by jettison of cargo or equipment for safety reasons, and general average sacrifices made to preserve the vessel.

Piracy & Violent Theft

Protection against damage from piracy attacks, violent theft, and malicious acts by third parties, subject to policy terms and geographic limits.

Important Exclusions

H&M policies typically exclude coverage for:

Wear, tear, and gradual deterioration
Inherent vice or latent defects
Wilful misconduct of the assured
Nuclear contamination/radiation
War risks (covered separately)
Unseaworthiness with privity

Key Features & Benefits

Our H&M insurance solutions are designed to provide maximum protection with flexible terms tailored to your operational needs.

Agreed Value Basis — Fixed valuation eliminates disputes at claim time, providing certainty of recovery in total loss scenarios.
Flexible Deductibles — Customizable deductible options to balance premium savings with risk retention based on your risk appetite.
Worldwide Navigation — Global trading coverage with optional seasonal restrictions for high-risk areas like Great Lakes ice navigation.
Increased Value Clause — Additional coverage for market appreciation, improvements, and equipment additions during policy period.
Loss of Hire/ earnings — Optional extension covering lost income during repair periods, protecting your cash flow.
Salvage & Sue & Labor — Coverage for reasonable costs incurred to preserve the vessel from further damage after an incident.

Construction Risks — Coverage for newbuildings and major conversions during construction period at shipyards.
4/4ths Collision Liability — Optional extension to cover full collision liability beyond standard 3/4ths coverage.
General Average Contribution — Protection against general average contributions when vessel is saved in emergency situations.
Port Risks Extension — Coverage for vessels laid up in port or undergoing repairs at shipyards.
Excess Liability Cover — Additional layers of coverage above primary limits for catastrophic events.
24/7 Claims Support — Immediate access to claims specialists for emergency response and guidance worldwide.

Vessel Types Covered

We provide H&M insurance solutions for all major vessel types, with specialized terms for each sector's unique requirements.

Bulk Carriers

Tankers (Oil/Chemical/LNG)

Container Ships

Passenger Vessels & Ferries

Offshore Support Vessels

Tugs & Workboats

Yachts & Superyachts

General Cargo Vessels

Ro-Ro & Car Carriers

FPSOs & FSOs

Drilling Rigs & Platforms

Fishing Vessels

Policy Terms & Conditions

Understanding the key terms and conditions that govern your H&M insurance coverage.

Standard Policy Conditions

Continuation Clause: Coverage continues during deviation, delay, or change of voyage, provided such changes are not willful.

Trading Limits: Defined geographic areas where the vessel may operate. Breaching limits may void coverage or require additional premium.

Classification Warranty: Vessel must remain in class with an approved classification society throughout the policy period.

Seaworthiness Warranty: Implied warranty that the vessel is seaworthy at the commencement of each voyage.

Survey Requirements: Periodic surveys may be required for older vessels or those entering high-risk areas.

Premium Factors

Vessel age, type, and condition
Trading routes and navigation limits
Insured value and deductible levels
Classification society and management quality
Claims history and loss record
Crew competence and ISM Code compliance

Typical Deductible Structure

Loss Type	Typical Deductible
General Damage	$50,000 - $250,000 per occurrence
Machinery Damage	$100,000 - $500,000 per occurrence
Collision Liability	$50,000 - $150,000 per occurrence
Total Loss	Nil (no deductible)
Grounding/Stranding	$75,000 - $300,000 per occurrence
Heavy Weather	$50,000 - $200,000 per occurrence

Policy Duration

Annual Policy: Standard 12-month policy period with renewal on February 20th (Lloyd's policy anniversary).

Short-Term Policies: Available for specific voyages, time charters, or construction periods.

Run-Off Coverage: Extended coverage for claims arising after policy expiry but from incidents during the policy period.

H&M Claims Process

Our dedicated claims team provides expert guidance through every step of the H&M claims process, ensuring prompt and fair settlement.

01

Report Incident

Notify us immediately via 24/7 hotline. Provide initial details of incident, location, and extent of damage.

02

Initial Assessment

Our team evaluates coverage applicability, appoints surveyors, and guides immediate actions to mitigate damage.

03

Survey & Documentation

Professional surveyors assess damage. We assist in gathering required evidence, repair quotes, and supporting documents.

04

Repair Coordination

We coordinate with repair yards, monitor progress, and ensure cost-effective solutions while maintaining quality standards.

05

Settlement

We negotiate with insurers, apply deductibles, and process payment promptly. Total loss claims handled with expedited procedures.

24/7 Claims Hotline: +44 20 7423 1111

Full Claims Guide

Related Services

Complete your marine insurance portfolio with these complementary coverage solutions.

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