Marine Insurance Claims in Bangladesh 2026: Cargo, Hull, P&I, Collision, Crew and Port Disputes

Marine insurance claim Bangladesh law in 2026: one casualty, many claims

A marine insurance claim Bangladesh insurers receive rarely stays a simple policy claim. A damaged steel cargo, a gashed hull at the Chattogram anchorage or a tanker striking an oil jetty quickly involves the insured, the insurer, the shipowner's P&I club, the other ship, the crew and the port authority, each with its own statute, forum and deadline. The party that knows which clock is running, and which security it can demand, usually decides the outcome.

This guide covers the legal basis of marine insurance and the local-insurance rule, cargo and hull claims and their time limits, P&I club cover and security, collision apportionment and time bars, seafarer wage liens, and disputes with the Chattogram Port Authority over tariffs, port property and the 2026 terminal concessions.

Summary: Bangladesh has no marine insurance statute of its own: policies are written under the Insurance Act 2010, regulated by IDRA and interpreted largely through English marine insurance principles. Risks in Bangladesh must be insured locally unless IDRA certifies otherwise. Claims against the ship, whether by cargo insurers, colliding owners, crew or the port, run through the Admiralty Court, the Merchant Shipping Ordinance 1983 and short limitation periods that the High Court Division now applies strictly.

Key point: On 27 November 2025 the Admiralty Court rejected a US$3 million collision suit as time-barred even though the plaint had been registered within two years of the collision. The court held that a suit is instituted only when the plaint is presented to the judge for admission, and the plaint had not reached the judge until 2025. Filing at the counter is not enough.

At a glance

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Table of Contents

The legal framework for a marine insurance claim Bangladesh courts will hear

Marine insurance in Bangladesh sits in an unusual legal space. The Insurance Act 2010 (Act No. XIII of 2010) regulates insurers, licensing, investment, agents and surveyors, and the Insurance Development and Regulatory Authority (IDRA), established under a separate 2010 Act, supervises the market.[1] Neither statute contains a code of marine insurance contract law. There is no Bangladeshi equivalent of the Marine Insurance Act 1906: the contract is governed by the Contract Act 1872, custom and practice, and, in appropriate cases, the English Act of 1906 itself.[2]

The Marine Insurance Act 1906 as working law

Cargo and hull policies issued in Bangladesh commonly incorporate Institute clauses drafted for the London market, which presuppose the 1906 Act. Concepts such as utmost good faith, warranties, actual and constructive total loss, notice of abandonment, particular and general average, the duty to sue and labour, and subrogation are therefore read in the sense English law gives them. English law has since reformed parts of these rules by statute, while Bangladesh has not, so older English principles may still be argued here.

The local-insurance rule

Section 19 of the Insurance Act 2010 provides that no person shall insure outside Bangladesh any risk in respect of any property or interests in Bangladesh, unless IDRA first certifies that the risk cannot be covered in Bangladesh. IDRA may grant exemptions for such period as it thinks fit, and must notify any refusal in writing within 15 days of the application.[1] For importers, this is why marine cargo cover for goods brought into Bangladesh is normally bought from a Bangladeshi insurer, with the policy tied to the letter of credit, rather than left to the foreign seller. Foreign capacity enters through reinsurance, not direct policies.

The rule shapes every marine insurance claim Bangladesh importers make: the importer claims against a local insurer, often under English-law wording, and the insurer then pursues the carrier as subrogated claimant and recovers from reinsurers abroad. Survey evidence must therefore meet an international standard from the outset.

What the regulator does and does not do

IDRA licenses insurers and surveyors and can act against an insurer that does not pay. Section 10(1)(j) of the Act makes it a ground for suspending or cancelling an insurer's registration if it fails to pay a claim arising in Bangladesh within three months after a final judgment or a direction of the Authority.[1] The Act defines an insurance surveyor as a person licensed under it who examines and expresses an independent opinion on the cause, extent and amount of a loss.[1] IDRA does not decide the contract dispute; a rejected insured must sue.

Claims performance in 2025 and 2026: why insureds must plan for delay

Bangladesh's non-life insurers are under visible strain. Figures reported in March 2026 showed that general insurers settled Tk 372 crore of the Tk 3,971 crore in claims filed in October to December 2025, a settlement rate of 9.37 per cent; the state-owned Sadharan Bima Corporation settled Tk 77 crore of Tk 2,264 crore.[3] The same report noted that insurers are required by law to settle valid claims within 90 days, and that the rule is frequently ignored.[3]

For a marine insurance claim Bangladesh importers and owners present in 2026, the lesson is practical: give the insurer no documentary reason to delay, set written deadlines, escalate to IDRA when the insurer is silent, and keep the limitation period in view. The Commercial Courts Act 2026 has also created specialist business courts, so check whether a policy dispute now belongs there before choosing a forum.

Cargo claims: notice, survey and the time to sue

A cargo marine insurance claim Bangladesh insurers handle usually fails on procedure rather than merits. The insured must notify promptly, preserve the goods, cooperate with a licensed surveyor and protect the insurer's recovery against the carrier. The policy sets the detail; the statutory deadlines below set the outer limits.

Protecting the recovery against the carrier

Where the Hague Rules scheduled to the Carriage of Goods by Sea Act 1925 govern the bill of lading, written notice of loss or damage must be given at the port of discharge before or at the time the goods are taken into the receiver's custody, or within three days if the damage is not apparent. The carrier and the ship are discharged from liability unless suit is brought within one year after delivery or the date when the goods should have been delivered, and liability is limited to £100 per package or unit unless the value was declared and inserted in the bill of lading.[4]

The one-year bar is the commonest reason subrogated cargo insurers lose recoveries, and an insured who signs clean receipts or notifies late can prejudice that recovery and invite a defence from its own insurer. Our guide to cargo loss and short delivery claims in Bangladesh covers the carriage side; this article concerns the insurance claim that runs alongside it.

The time to sue the insurer

The insured's own claim against the insurer has a longer clock. Article 86(b) of the First Schedule to the Limitation Act 1908 gives three years for a suit on a policy of insurance where the sum insured is payable after proof of loss, running from the date of the occurrence causing the loss.[5] Time runs from the casualty, not from the insurer's rejection letter, so a long adjustment process eats into the period.

Some policies require suit within twelve months. Section 28 of the Contract Act 1872 declares void, to that extent, an agreement that limits the time within which a party may enforce its rights through the ordinary tribunals, with exceptions for arbitration agreements.[11] A contractual time bar is therefore open to challenge in Bangladesh, but the safer course is never to test it.

Documents that move a cargo claim

Submit together the policy or certificate naming the L/C bank, the bills of lading, tally and outturn reports, a joint survey report with photographs, the invoice and letter of credit, evidence of any salvage sale, and copies of the notices served on the carrier with any time extension it has agreed.

Hull and machinery claims for Bangladeshi owners

Hull claims raise different questions. The owner must show an insured peril, prove the cost of repair or the extent of the loss, and comply with conditions on notice, class surveys and the insurer's approval of repair yards. Where the ship is a constructive total loss, the owner must decide quickly whether to give notice of abandonment, because the remedy turns on it. Because of section 19, Bangladeshi owners usually carry hull cover locally, reinsured abroad.

A collision brings hull and liability cover together. Hull policies on Institute terms typically answer for part of the owner's liability to the other ship under a running-down clause, while the P&I club picks up the balance and the liabilities hull cover excludes, such as damage to fixed and floating objects, wreck removal and crew claims. Owners should notify both underwriters at once and agree who leads the defence.

P&I clubs in Bangladesh: cover, correspondents and club security

Protection and indemnity clubs are mutual associations of shipowners and charterers that insure third-party liabilities arising from operating ships: cargo claims, collision liability not covered by hull policies, damage to docks and jetties, pollution, wreck removal, and crew death, injury, illness and repatriation. Foreign ships calling at Chattogram, Mongla and Payra are almost all entered with international clubs, which act in Bangladesh through local correspondents who appoint surveyors and lawyers when a casualty occurs.

How a P&I club responds to a claim

When a claim arises, the correspondent attends, the P&I club appoints a surveyor and assesses cover and liability. The club's legal obligation is to indemnify its member, not to pay the claimant, but in practice it controls the defence and settlement. A claimant who engages early with the correspondent reaches the decision-maker faster than one who writes only to the owner.

Letters of undertaking and bank guarantees

Security is where P&I practice in Bangladesh differs from London or Singapore. A club letter of undertaking is widely accepted between parties abroad, but in the Admiralty Court it generally secures release only where the claimant agrees to it. Where the claimant refuses, the owner must usually put up a guarantee from a bank in Bangladesh or cash, often counter-guaranteed by the club. Our guide to the ship release bank guarantee in Bangladesh explains the wording and amount, and our note on vessel arrest and release covers the arrest itself.

Club security outside the courtroom

Security is also demanded without any arrest. In April 2026 the Panama-flagged tanker Prive Angel, carrying 35,055 tonnes of diesel, struck Dolphin Oil Jetty-6 at Chattogram while berthing under a port pilot, damaging the loading platform and approach bridge. A joint inspection committee assessed rehabilitation at Tk 3.40 crore, about Tk 4.25 crore with VAT and taxes. The club agreed Tk 3.25 crore but disputed the tax element, and the port authority withheld departure clearance at the jetty operator's request until a bank guarantee for the full claim was provided.[10]

A club that signs a joint survey report should expect its figures, taxes included, to be treated as agreed, and the cost of a detained ship, reported at US$20,000 to US$25,000 a day in that case, usually outweighs the disputed sum.[10]

What a P&I lawyer in Bangladesh actually does

For a P&I club and its members, local counsel files caveats against arrest, tests claims for jurisdiction and limitation defences, negotiates the amount and form of security, attends joint surveys, settles crew wages before the Shipping Master and coordinates with any foreign-seated arbitration. For claimants, the job is to obtain security that will actually pay.

Ship collision claims: liability, apportionment and jurisdiction

The collision regulations and statutory duties

The Merchant Shipping Ordinance 1983 empowers the Government to make Collision Regulations and requires them to be observed, within Bangladesh jurisdiction, by foreign ships as well as Bangladeshi ones. If damage arises from non-observance of the Regulations, it is deemed to have been caused by the wilful default of the person in charge of the ship unless the court is satisfied that the circumstances made a departure necessary.[6] That presumption makes the COLREGs the starting point of every collision analysis.

After a collision, each master must, so far as possible without danger to his own ship, stand by and assist the other ship, and give her the name of his ship, her port of registry and her last and next ports. Failure without reasonable cause is an offence punishable with imprisonment of up to six months or a fine of up to Tk 10,000, and may lead to an inquiry into a certificated officer's conduct. The master must also enter a statement of the collision in the official log.[6]

How liability is apportioned

Where two or more ships are at fault, liability for damage to the ships, their cargo or property on board is borne in proportion to each ship's degree of fault. If different degrees of fault cannot be established, liability is apportioned equally, and no ship is liable for loss to which her fault has not contributed. Liability for loss of life or personal injury on board is joint and several, with a right of contribution between owners according to fault.[6]

Apportionment therefore turns on navigation evidence: voyage data recorder and ECDIS downloads, AIS tracks, logs, pilot cards and VHF recordings, all of which should be secured on the day of the collision.

Collisions at Chattogram

The approaches to Chattogram are crowded, tidal and restricted, and collisions in the anchorage and river approaches are a recurring risk. On 14 June 2019 the Kuwaiti tanker MT Burgan collided with the container ship then named X-Press Mahananda; the dispute between those owners was resolved in the English courts under a collision jurisdiction agreement, with judgment on 26 March 2025.[7] Where the main parties are foreign, such an agreement is common and sensible, but it does not stop the Bangladeshi limitation clock for claims filed here.

Admiralty Court jurisdiction

The Admiralty Court Act 2000 lists claims for damage caused by a ship among the heads of admiralty jurisdiction.[8] Section 5 restricts actions in personam for damage, loss of life or personal injury arising from a collision: the court may hear one only if the defendant ordinarily resides or carries on business in Bangladesh, the cause of action arose within Bangladesh's internal or territorial waters or the limits of a Bangladeshi port, or a related action is pending or decided in the court. It also bars a claimant whose earlier action against the same defendant abroad is still alive.[8] Our guide to the Admiralty Court Act covers actions in rem and arrest.

Time limits and limitation of liability in collision cases

The two-year bar and when a suit is instituted

Kuwait Oil Tanker Company v LCT Shakti Sanchar, decided by Justice Zafar Ahmed on 27 November 2025, is now the leading authority. The owner of MT Burgan sued in Bangladesh for US$3 million in collision damage. The court noted that the Appellate Division had applied the two-year period in section 8 of the Maritime Conventions Act 1911 in 1983, but that section 8 had since been repealed in England, and held that Article 36 of the Limitation Act 1908, which also provides two years, governs collision damage suits.[7] Article 36 runs from the date of the wrongful act.[5]

The plaint had been verified on 13 June 2021 and registered, with the court fee paid, on 14 June 2021. It was first presented to the judge for admission on 23 July 2025. The court held that a suit is instituted when the plaint is presented to the presiding judge, not when it is received or registered by the office, and rejected the plaint under Order VII rule 11(d) of the Code of Civil Procedure. Parallel English proceedings were no excuse: the plaintiff could have filed in time and sought a stay.[7]

Limitation of the owner's liability

Separately, section 471 of the Merchant Shipping Ordinance 1983 allows the owner of any ship to limit liability for loss of life, personal injury or property damage caused without its actual fault or privity. The limits are set per ton of gross tonnage: Tk 5,000 where only life and injury claims arise, Tk 1,500 where only property claims arise, and Tk 5,000 in aggregate where both arise, with life claims ranking first over the initial Tk 1,500 per ton. For this purpose the owner includes the charterer, manager and operator.[6] Because the taka figures are low, claimants facing a limitation plea focus on proving actual fault or privity.

Seafarer wage claims and the crew's maritime lien

The statutory lien and its priority

Crew claims are the most protected claims in the system. Under the Merchant Shipping Ordinance 1983 a seaman has a lien on the ship for his wages and cannot forfeit it by agreement; any stipulation inconsistent with the Ordinance is void. The master has the same rights, liens and remedies for his wages and for disbursements properly made on account of the ship. The seaman's lien takes precedence over all other liens or charges on the ship, and the master's lien ranks next.[6] A mortgagee or buyer at a judicial sale therefore takes subject to unpaid crew wages. Our explainer on ship mortgages and maritime liens sets out the terminology.

Payment on discharge and the delay penalty

The owner or master must pay a discharged seaman's wages within five days of discharge, with one quarter of the balance due payable on account at the time of discharge. If payment is delayed without reasonable cause, the Shipping Master may award up to two days' pay for each day of delay, recoverable as wages. A release signed before and attested by the Shipping Master operates as a mutual discharge of claims for the voyage.[6] Owners should therefore settle crew claims through the Shipping Master.

Suing for wages in the Admiralty Court

Wage claims of a master or crew are a listed head of admiralty jurisdiction, and the court fee for them is fixed at Tk 100, against a cap of Tk 1,00,000 for other claims.[8] Article 102 of the Limitation Act gives three years from when the wages accrue due, and section 220 of the Ordinance excludes from any limitation period the time during which the seaman was serving.[5] [6]

The court's recent judgments show both the strength and the pace of these claims. In Zakir Hossain v MV Crystal Gold, decided on 7 July 2026, the master and chief engineer of a Bangladeshi-owned ship had been unpaid since November 2014. The owner's ISM manager alleged misconduct and theft of stores but led no evidence. Justice Sikder Mahmudur Razi held that seamen's wages are a classic maritime lien that travels with the ship, found the vessel, her registered owner and her ISM manager jointly and severally liable, and awarded interest at 6 per cent.[9] The suit had been filed in 2015, eleven years earlier.

MLC 2006 and the unfinished statute

Bangladesh ratified the Maritime Labour Convention 2006 on 6 November 2014. The Convention works through national law, and commentators have pointed out that the 1983 Ordinance is not fully aligned with it; its minimum age for seafarers, for example, is 15 against the Convention's 16.[12] A replacement merchant shipping statute and MLC implementing regulations have been prepared in draft, but we have not identified an enacted Merchant Shipping Act. As at October 2026 the 1983 Ordinance remains the governing law for wage claims, and anyone citing a "Merchant Shipping Act 2020" should check the official text first.

Chattogram Port Authority disputes

Chattogram is not only a port but a party. The port authority sets tariffs, controls berthing and clearance, owns the quays and cranes, and grants terminal concessions, so disputes with it are public-law as much as commercial disputes.

Tariffs and the 2025 tariff litigation

The Authority's revised tariff was notified on 14 September 2025 under SRO No. 364-Ain/2025, deferred for a month after stakeholder pressure, and implemented on 15 October 2025. Following a writ petition, a High Court Division bench stayed the new tariff for one month on 9 November 2025. That stay was effectively vacated on 25 November 2025 when Civil Petition for Leave to Appeal No. 4430 of 2025 was disposed of, and on 30 November 2025 the Authority reinstated the higher charges under SRO No. 430-Ain/2025.[13]

Charter parties, freight contracts and terminal agreements should say who bears new port charges; our guide to freight and charter party claims covers those contracts.

Damage to port property

When a ship damages a quay, crane or jetty, the Authority or terminal operator rarely sues first. It withholds port clearance, as in the Prive Angel case, until compensation is paid or security provided.[10] Owners and clubs should insist on a joint survey and record reservations in writing; where clearance is withheld unreasonably, the remedy may lie in writ proceedings rather than admiralty.

Terminal concessions in 2026

On 8 October 2026 the Authority signed a 15-year concession with DP World to operate and maintain the New Mooring Container Terminal and its overflow yard, with an upfront payment of US$50 million, a guaranteed minimum annual payment of Tk 10 crore, a planned US$150 million modernisation programme and financial penalties for missing performance targets. The Authority keeps ownership, and harbour management, security and customs remain with the state. APM Terminals began building the US$550 million Laldia terminal on 31 August 2026.[14]

Concessions change who port users contract with. Terminal damage, delay and overcharging claims will increasingly lie against a private operator under its published terms, so shippers, lines and their insurers should review those terms now.

Who decides which marine insurance claim Bangladesh forums hear

Step by step: handling a marine casualty and the insurance claim

Whether the casualty is a damaged cargo, a collision or a crew claim, the same sequence protects a marine insurance claim Bangladesh insurers and their insureds may later need to prove.

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Time limits and forums at a glance

The table below compares the main claims discussed above. On a phone, scroll it sideways.

Mistakes to avoid in a marine insurance claim Bangladesh parties pursue

• Treating registration as filing: after Kuwait Oil Tanker, a plaint that is registered but not presented to the judge within time is barred.[7]
• Negotiating past the deadline: the three-year period against an insurer runs from the casualty, not the rejection letter.[5]
• Losing the carrier recovery: late notice and clean receipts undermine the one-year Hague Rules claim the insurer depends on.[4]
• Signing joint survey figures casually: once signed, port and jetty assessments are hard to reopen.[10]

What to watch in 2026 and 2027

Four developments will shape every marine insurance claim Bangladesh parties bring over the next year: the non-life claims backlog, the Admiralty Court's strict approach to limitation, any enacted merchant shipping statute, and port concessions that move many port disputes to private operators.

When a claim arises, the earliest decisions carry the most weight. Explore our customs and trade compliance practice, our overview of maritime law in Bangladesh, or contact TRW for a prompt review.

Frequently asked questions

Is there a Marine Insurance Act in Bangladesh?

No. Bangladesh has no marine insurance statute of its own. Contracts are governed by the Contract Act 1872, custom and the policy wording, and courts may draw on the English Marine Insurance Act 1906.[2]

Can an importer insure cargo bound for Bangladesh with a foreign insurer?

Not without IDRA's certificate. Section 19 of the Insurance Act 2010 prohibits insuring risks relating to property or interests in Bangladesh outside the country unless IDRA certifies that the risk cannot be covered locally.[1]

How long do I have to sue my marine insurer in Bangladesh?

Generally three years from the occurrence causing the loss, under Article 86(b) of the Limitation Act 1908. A policy clause shortening that period is open to challenge under section 28 of the Contract Act 1872.[5] [11]

How quickly must an insurer pay a marine insurance claim Bangladesh insureds submit?

Insurers are reported to be required by law to settle valid claims within 90 days, though the rule is often not observed. Failure to pay within three months of a final judgment or IDRA direction is a ground for action against the insurer's registration.[1] [3]

Will the Admiralty Court accept a P&I club letter of undertaking?

Usually only if the claimant agrees. Otherwise expect to provide a guarantee from a bank in Bangladesh or cash, often backed by the club.

How is liability shared when two ships collide?

In proportion to each ship's degree of fault, or equally if degrees of fault cannot be established. Liability for death or personal injury is joint and several, with contribution between owners.[6]

What is the time limit for a ship collision claim in Bangladesh?

Two years from the collision under Article 36 of the Limitation Act 1908, as the Admiralty Court held in November 2025. The suit must be presented to the judge, not merely registered, within that time.[7]

Do seafarers have priority over a ship's mortgagee?

Yes. The seaman's lien for wages takes precedence over all other liens or charges on the ship, and the master's lien ranks next.[6]

Has Bangladesh ratified the Maritime Labour Convention 2006?

Yes, on 6 November 2014. Its standards apply through national law, and the Merchant Shipping Ordinance 1983 remains the main statute for crew wages.[12]

Can the Chattogram Port Authority hold a ship that damaged port property?

In practice it withholds departure clearance until compensation is paid or a bank guarantee is provided, as it did with the tanker Prive Angel in 2026.[10]