Bumbershoot Policy – Definition

Bumbershoot Policy Definition

The Bumbershoot policy refers to an umbrella coverage or an umbrella insurance policy specifically designed for the maritime industry. It is a form of excess liability insurance that was conceived insure marine risks. Maritime activities are human activities at the sea in relation to conveyance or production of goods.

The Bumbershoot policy offers coverage for hazards in maritime companies,fg it also covers shipyards. The amount of coverage offered by the bumbershoot policy exceeds the limits of underlying liability policy. The policy not only covers maritime risks but also non-maritime risks, it offers coverage for dry and wet incidents, collisons, indemnity and others.

A Little More on What is the Bumbershoot Policy

The bumbershoot insurance policy proved a wider coverage for companies in the maritime industry or maritime activities at large. Commercial lines insurance span across general liability insurance, workers compensation insurance, bodily and property damage, and litigation coverage. The bumbershoot insurance policy however transcends beyond these, it protects industries from wet and dry incidents, that is, maritime and non-maritime activities.

This policy covers expenses relating to salvage, collision, and indemnity. The coverage of liabilities that the bumbershoot policy caters for must however be in accordance to the standards set by the Longshoreman and Harbor Workers’ Act.

Shipyard workers and terminal operators can also benefit from the bumbershoot insurance policy. The policy provides coverage for;

  • Personal injury of workers or passengers,
  • Weather incidents,
  • Losses and damages during cargo transportation,
  • Hijacking situations, and a few others.

Bumbershoot policy is an umbrella insurance policy or coverage that protects businesses in the maritime industry from risks associated with wet and dry maritime. Countries that border on the sea carry out a lot of merchandise of goods, cargo transportation and other maritime related activities using the sea. In 2017, a data from World Trade Organization (WTO) revealed that 21.7% out of a total of over $1.5 billion of the United State exports used sea transport (maritime).  Furthermore, the European Union date revealed that 72.8% out of a $2.1 billion merchandise were transported by the sea. Bumbershoot policies are then of significance to countries whose exports are largely done through sea transportation and countries that are beneficiaries of the exports.

References for Bumbershoot Policy

Academic Research on Bumbershoot Policy

Allocation of Marine Risks: An Overview of the Marine Insurance Package, Lemon, R. T. (2006). Tul. L. Rev., 81, 1467.

Limitation of liability from a marine insurance viewpoint, Buglass, L. J. (1978). Tul. L. Rev., 53, 1364.

Breaking down the Bumbershoot: Energy and Marine Umbrella Insurance Policies in the Wake of Indemnity Insurance Co. of North America v. W&T Offshore, Drenan, M. T. (2015). Transp. LJ, 42, 1.

Handling of the Big Case: Practical and Legal Considerations Concerning P and I Involvement in Catastrophes, Gerity, J. F. (1968). Tul. L. Rev., 43, 673.

The Mixed Up Exercise of Admiralty Jurisdiction Over Mixed Contracts, Namely Umbrella Insurance Policies Covering Shore-side and Sea-side Risks, Powell, P. M. (2015). Ocean & Coastal LJ, 20, 1.

A Fifty Year Retrospective on the American Law of Marine Insurance, Watson, H. K. (2016). Tul. L. Rev., 91, 855.

Insurance and the Explorer, Agnew, J. D. (1972). The APPEA Journal, 12(1), 155-160.

The 1976 IMCO Limitation Convention: A Comparative View, Watson, H. K. (1977). Hous. L. Rev., 15, 249.

Marine Insurance: Varieties, Combinations, and Coverages, Hayden, R. P., & Balick, S. E. (1991). Tul. L. Rev., 66, 311.

Insurance Issues, Lewis, R. P., & Priscott, J. N.

Handling of the Big Case: Practical and Legal Considerations Concerning P and I Involvement in Catastrophes, Gerity, J. F. (1968). Tul. L. Rev., 43, 673.


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