In Ocean Marine insurance, what does the term of sale imply regarding the responsibility for cargo damage during shipment?

Prepare for the Florida Certified Insurance Representative Exam. Use multiple choice questions and detailed explanations to enhance your study sessions. Improve your chances of success!

In Ocean Marine insurance, the term of sale plays a significant role in determining the responsibility for cargo damage during shipment. When the term indicates that the seller is responsible for the damage, it aligns with common practices in shipping agreements, where the seller typically retains accountability for the cargo until it reaches the buyer. This means that any loss or damage to the goods while in transit is the seller's liability.

In many sale contracts, shipping terms such as "FOB (Free on Board)" or "CIF (Cost, Insurance, and Freight)" define who bears the risk during transportation. Under these terms, until the cargo is delivered to the destination and accepted by the buyer, the responsibility for any potential damage remains with the seller. Thus, this option accurately reflects the principle that the seller is liable for the condition of the goods until they are received by the buyer, ensuring they are responsible for any damage incurred during shipment.

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