Question 54 GLI01 - Master-Unlimited Tonnage

The Correct Answer is D **Explanation for Option D (As a particular average claim) being correct:** Particular Average (PA) refers to a partial loss sustained by a specific interest (in this case, the cargo owner of the cotton) due to an accidental cause, such as fire. Crucially, this loss is borne solely by the owner of the interest that suffered the damage. Since the fire only damaged 20 bales of cotton and this damage was accidental (not the result of a voluntary sacrifice made for the common safety of the whole venture), it is handled as a Particular Average claim against the insurer of the damaged cargo. **Why the other options are incorrect:** * **A) As a general average claim:** General Average (GA) only applies when there is an extraordinary sacrifice or expenditure voluntarily and reasonably made in time of peril for the purpose of preserving the property imperilled in the common maritime adventure (e.g., throwing cargo overboard to refloat a ship). In this scenario, the fire damage to the 20 bales was accidental damage, not a deliberate sacrifice made to save the entire ship and remaining cargo. * **B) As a constructive total loss claim:** A Constructive Total Loss (CTL) occurs when the cost of recovering and repairing the damaged property would exceed its value, or when the cost of saving the property from the peril would exceed its value. Damage to only 20 bales of cotton on a larger freighter does not meet the criteria for a CTL, which applies to the whole insured subject matter becoming uneconomical to save. * **C) As a total loss of a part claim:** While the 20 bales themselves are totally lost (or deemed lost), the technical insurance term for this type of partial loss affecting only a specific, identifiable interest due to an accidental peril is **Particular Average**. "Total loss of a part" is not the standard legal classification used in marine insurance for a partial loss of cargo caused accidentally.