The Insurance of Cargoes. 
13 
63. We suggest that there shall only be one State office, and that in London. A 
proposal was made to us that offices should also be opened in Liverpool and Glasgow, 
and possibly Cardiff as well ; but on the whole we came to the conclusion that the 
administrative difficulties of establishing and conducting so many separate offices at 
such a time would not be compensated for by any corresponding advantages.. 
64. Every cargo-owner will be able to obtain provisional cover for war risks on his 
cargo at this office, pending the production of details of shipment. The value gi’ven 
must be the outside limit of his requirements on a particular shipment. It subsequently 
he produces evidence to show that this provisional value was excessive, the piemium 
paid on such excess value will be refunded to him ; but he will not be permitted to 
increase his provisional insurance for that particular shipment. 
65. Pavment of premiums must be made to the State office in cash when the 
provisional insurance is effected. An insurance slip will be handed over to the State 
office. Stamps to the amount of the premium required will be impressed on a counter 
part of this insurance slip, and this counterpart will be handed to the assured, and wi 
be conclusive evidence that the insurance has been accepted by the State. 
66. In order to fix values the assured must subsequently produce to the State 
office his marine insurance policy or policies covering the same goods, and the values m 
these marine insurance policies will be accepted by the State as the final values foi war 
risk insurance. ^ ... . 
67. Marine insurance policies will only be accepted by the State it issued by 
members of Lloyd’s, British insurance companies, and other approved insurance companies 
anc j undcrwriijcrs 
68. The final State policy will then be issued for the same values, and for 
the same voyage as covered by the marine policies, and these documents will be 
attached to each other, so as to form a complete insurance for the risks of the voyage 
in question. _ . . . 
69. In requiring the issue by the State of a policy guaranteeing a specified value m 
the case of each shipment, we are adopting the conclusions ol Mr. Austen Chamber am s 
Committee (see paragraph 210), as such a policy will be required by bankers, bi 
brokers, and others when financing the movement of produce in time ol war. 
70. It will be seen that we recommend the adoption for State insurance ol war 
risks or' the values agreed in the marine insurance policies covering the gooils on t le 
same voyage. We considered many other suggestions for arriving at values for k.tate 
insurance, as we were anxious to secure for the State the fullest possible protection 
against fraud. The most attractive of these suggestions was to take the mvoicec va ue 
of cargo at port of shipment, plus cost of insurance and shipping charges, but we o 
not consider that this would afford any better protection to the State than la mg e 
values in the marine policies, while it would certainly make the adminis ra ive 
machinery much more cumbrous and lengthy. Nor would it facilitate the requiremen s 
of bankers and others who are financing the shipment of the goods, as the values m re 
State policy would differ from those in the marine policies, and there would not e tie 
same certainty that the two insurances covered the same shipment. 
71. We'believe, too, that the interests of the State will be best protected by 
accepting for war risk insurance the values agreed in the marine policies. I <ese are 
now accepted by the insurance market for payment of losses, subject to cha enge in re 
case of suspected fraud or mutual mistake; and we were told by representatives o 
the insurance market that instances of fraudulent values are rare. It is rue a 
these values in marine policies habitually include an estimated profit on tie veil uie o 
up to 10 per cent, or 15 per cent. ; but if there is any doubt as to the correctness ol the 
values given, it is always possible to control them, in the case of all cuirent ai ic es, y 
the daily published quotations of prices ; and, besides, the original invoices an oner 
documents can be called for if required to prove the correctness ol the insurec va ues. 
72. All claims will be settled by the Board ol Advisers, but in the even o '® ie 
being any dispute with the assured as to the proposed settlement the lia n y o le 
State will have to be settled (failing agreement to refer to arbitration) by e ourts 
73. Payment of claims, when admitted, will be made at once in cash. In this 
respect cargo-owners, it will be noticed, will be treated better than s npowneis, w o 
will not be paid their first instalment until six months after loss. 
74. On what principle is the rate of premium for State insurance on caigo o e 
fixed ? It will be seen that in the case of hulls we have good reasons lor recommending 
varying rates (paragraph 30), more or less proportionate to the risks of t e lespec ive 
voyage,-,, with a maximum rate of 5 per cent, and a minimum rate ol 1 per ceu ■ 11 ie