Maritime Law, Insurance & Enforcement
Hull and Machinery Insurance
Summary
Hull and machinery (H&M) insurance protects the insured against specified physical loss or damage to the vessel and machinery.
Why this matters in ship finance
Lenders depend on insured value, casualty response and agreed application of proceeds to repairs or repayment.
The concept
The policy, exclusions and governing insurance law determine cover; EU statutory maritime-liability insurance is not a substitute for bank-required H&M.
How it is used in practice
Review insured value, deductible, total-loss definition, loss adjustment, survey warranties, deductibles and named insured/loss payee provisions.
Practical issues
Coverage depends on wording and governing law; do not presume every machinery breakdown or consequential lost revenue is insured.
How ShipFinance.ai uses this concept
Offer a mortgagee-focused H&M review and total-loss proceeds waterfall.
Key takeaways
- H&M insures specified physical risks, not every revenue loss.
- Insured value and claims-payment terms affect debt recovery.
- Review exclusions and policy law before relying on cover.