Legal Analysis of the Impact of the Guaranteed Outturn Clause on the Marine Insurance Policies of Oil Cargos

Razavi, Mohamadhasan; Faraji, Mohammad

doi:10.48308/eclr.2025.234617.1049

Legal Analysis of the Impact of the Guaranteed Outturn Clause on the Marine Insurance Policies of Oil Cargos

Document Type : Original Article

Authors

Mohamadhasan Razavi

Mohammad Faraji

L.L.M Student, Faculty of Law & Political Sciences, University of Tehran, Tehran, Iran. mohamad.faraji@ut.ac.ir

https://doi.org/10.48308/eclr.2025.234617.1049

Abstract

Nowadays, due to increasing importance of international trade and transportation of crude oil, sellers and purchasers of crude oil are constantly looking for the best and most efficient insurance coverages for their oil cargoes, which they sell and purchase. This has become significantly important especially in recent decades, due to considerable increase in oil price which has subsequently increased extensively the risks of transportation of crude oil.

This article studies the general clauses of Lloyd’s marine policy, as one of the most important examples of model contract and clauses on oil cargo insurance. It then focuses on exploring the guaranteed outturn clause and the difficulties which may arise if the sale and purchase contracts keep silent on the quality determination issue. This paper can assist the owners and carries of crude oil to have a better understanding of their risks and to use the best and most efficient options available to cover and control the risks of their commercial voyage.

Keywords

Guaranteed Outturn Clause

Institute Bulk Oil Clauses All Risks

Lloyd’s Marine Policy

Crude Oil

Insurance policy

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