Explain and discuss the concept of total loss and partial loss under a hull policy and a cargo policy.
Total loss can be defined as destruction of an asset or property to the extent that nothing of value remains. Total loss may also occur when the repair cost of a damaged asset or property exceeds the value of its policy. Instances of a partial loss the damage value does not exceed the value of the asset or property. When an asset or property suffers damage that does not render it useless it is considered a partial loss. A hull policy provides insurance coverage against physical loss or damage to the hull of a ship or aircraft. The cargo insurance policy compensate the insured in the event of loss or damage during the time of voyage.

Total loss under the hull policy arises when the extent of damages to the hull values exceeded the value of the vessel pre-destruction state for example The vessel gets damaged in a hurricane and sinks to the ocean floor. In this case, the vessel cannot be recovered and is considered a total loss. Partial Loss occur when the damage does not render the hull useless for its designed purpose for example A burst in the boiler room which damages some parts of the ship. Although internally some parts are damaged, the ship can be repaired and used again.

The cargo total loss policy cover loss or damage of cargo while it is in transit between the point of origin and final destination for example A vessel carrying iron ore runs a ground damaging her hull, the iron ore cargo being expose to water in its raw material rendering it useless. A cargo partial loss policy covers damage done to goods but not leaving the render useless for example a container on the deck containing a table, due to a storm the container was damage causing rain to