The nature of a Himalaya clause and its effect on insurance in the Marine insurance sector

Abstract

This study explores the concept of the Himalaya clause within the context of maritime insurance law. The Himalaya clause, often incorporated into bills of lading, extends liability limitations and defences to third parties, such as servants, agents, and independent contractors of the ocean carrier. The study examines the historical development of the privity rule in maritime contracts, the evolution of third-party benefits, and the legal implications of these clauses. It also analyses the effect on insurers when risks materialise and the circumstances under which insurers are liable to compensate for losses or damages. This study considers various international conventions and national legislations, including the Hague, Hague-Visby, and Hamburg Rules, to comprehensively understand the legal framework governing third-party liabilities in maritime contracts. In summation the study seeks to highlight governing principles that insurers ought to be cognisant of in drafting carriage and related insurance contracts to regulate the liabilities of parties to the carriage contract and third parties that may seek to benefit thereunder