Plaintiff individual shipowner acquired insurance from Defendant insurer for her ship M.V. “Ning Gao Peng 3368”. The individual shipowner employed a few crewmembers to navigate the ship. When buying the insurance, the individual shipowner informed the insurer of three crewmembers, and one of them was GAN whose misconducts caused the accident. During the period of insurance contract, the ship hit the pontoon and dock, and GAN was the duty driver. The individual shipowner paid compensation to the owner of the pontoon and dock, and sought indemnification from the insurer under the insurance contract. As the insurer refused to indemnify, the individual shipowner lodged the lawsuit. The court held that as expressly provided in the insurance contract, the insurer was exonerated from indemnification, if the accident was caused by the ship’s unseaworthiness; the vessel was unseaworthy at the time of accident, as GAN, the duty driver, did not have the certificate of competence, the ship was undermanned and the ship did not have a satisfactory safety management system, and the individual owner knew those matters; although the closest cause of the accident was GAN’s misconducts in course of driving, but the unseaworthiness could be deemed as the direct cause of the accident, so the insurer was exonerated.