Insurance Policy issued to Order of Issuing Bank

[LakshmananS]

A Documentary Credit called for an Insurance Policy or Insurance Certificate issued to the order of the Issuing Bank.

Beneficiary presented a Marine Cargo Certificate indicating among other information in boxed spaces-
Assured: (Beneficiary’s name)
Vessel: (Carrying Vessel’s name)
Consignee: To the order of (Issuing Bank’s name)
Date of Sailing: (Date of vessel’s departure)

The Insurance document was neither blank endorsed by the assured party nor assigned to the order of the Issuing Bank.

The documents were rejected by the Issuing Bank with the discrepancy
“Insurance Certificate assured not as per Letter of Credit”

The Negotiating Bank has rejected the discrepancy stating that the boxed space indicating Consignee: To the order of (Issuing Bank’s name) implies that the Insurance Certificate is issued to the order of the Issuing Bank.

The Issuing Bank’s contention is that the narrative and fashion in which the Consignee is stated in the Insurance Certificate is only a reflection of the consignee given in the Bill of Lading, is only an indicator that goods have been consigned to the order of the Issuing Bank and in no way satisfies the LC condition calling for an Insurance Certificate issued to the Order of the Issuing Bank.

Is the Negotiating Bank right in its argument?

Your comments please.

[RolandLeupi]

The word consignee regards documents of shipment. Insurance certificates are normally issued to the holder, to the order of or the the assured. In exception of where issued to the holder the certificates need to be endorsed. Issuing bank is therefore correct in it's decision
Roland

[POLTERD.]

It is a discrepancy.The doc.should state "assured/insured:to the order of abc" or "assured/insured:bnf and endorsed to the order of issuing bank."
Bogdan

[NigelHolt]

I agree with Roland & Bogdan.

[LakshmananS]

Thanks - Roland, Bogdan and Jeremy