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This type of insurance protects vessel charterers from a range of liabilities, either through contract or in tort. It covers the contractual and third-party liability of a vessel or the charterer.
It includes liabilities resulting from damage to the vessel itself or from third parties directly or by way of indemnity. The handling of a claim on behalf of the insured and the costs of defence and legal assistance are also insured, even if the insured subsequently proves not to be liable.