Probing compulsory insurance for maritime liability

The principle of compulsory insurance was developed due to the huge and peculiar liabilities that may be involved in maritime incidents. This paper examines the evolving framework for compulsory insurance as part of the maritime liability regime. Although lacking a specific definition in the maritime liability conventions, it is clear that compulsory insurance falls within the framework of: (1) Specified liabilities; (2) a certain amount; and (3) the liability insurer, who can be sued directly by claimants. Our analysis of the principle of compulsory insurance and the effects brought about by it has led us to question whether it is necessary to propose first-party insurance; and whether it is feasible to impose a uniform system of compulsoiy insurance for maritime liabilities.