Marine insurance offers coverage in case of damage or loss of cargo, ships, terminals, and any transport by which any property is acquired, transferred or held between the point of origin and its destination.
Cargo insurance is the sub-category of marine insurance. Marine insurance covers property exposed either onshore and/or offshore, marine casualty, marine liability, and hull damages.
In case goods are transported using a courier service, shipping insurance can be purchased.
Key Benefits of Marine Insurance
Here are the key benefits of marine insurance.
- Comprehensive all-risks coverage – A marine insurance plan offers comprehensive insurance coverage that safeguards your cargo from all the potential risks.
- Worldwide claims survey and settlement assistance – You don’t have to worry about your claim at all as worldwide claims settlement assistance is provided.
- Flexible coverage options available – Marine insurance needs are individualistic. Flexible marine insurance coverage fulfills your insurance needs.
- Customized covers suitable for your needs – Marine insurance offers customized coverage that suits your insurance expectations.
- Extensions for riots, strikes, and other perils. – To enhance the coverage offered by the basic insurance plan, you can opt for extensions in case of riots, strikes, and other catastrophes.
Types of Marine Insurance
The different types of marine insurance are elaborated below.
- Cargo Insurance– Cargo insurance offers insurance particularly for the cargo of the ship. It also provides coverage for the ship voyagers’ belongings.
- Hull Insurance-Hull insurance caters to the hull and torso of the vessel including all the articles and furniture of the ship. Hull insurance is purchased by the shipowners so that the ship is safeguarded if any unfortunate situation occurs.
- Liability Insurance-Liability insurance provides compensation in case any liability is sought if the ship crashes, collides, or is attacked.
- Freight Insurance-Freight insurance provides an extra layer of security to merchant vessels’ corporations in case any cargo is lost due to an unfortunate situation. Freight insurance is a much-needed solution for the companies facing monetary losses due to unprecedented situations and accidents.
You may Like to Read: Different Types of Marine Insurance Plans
There are plenty of marine insurance plans that offer flexibility to the clients in terms of selecting an insurance plan. The wide range of marine insurance plans offer the client the liberty to choose a plan that suits them best. Here are a few from the plethora of marine insurance plans
- Voyage Plan- A voyage plan is a type of marine insurance plan that is purchased for a particular sea voyage. When your journey is over, the validity of your policy is also over.
- Time Plan – A marine insurance policy which is issued for a particular time period is called a time policy. Generally, this policy is valid for a year.
- Mixed Plan – A marine insurance plan which provides the benefits of time as well as a voyage plan to its clients, is called a mixed plan.
- Valued Plan– A valued marine insurance plan is a direct reversal of the open marine insurance plan. Under the open marine plan, the value of the consignment and cargo is evaluated and it is written in the insurance document in advance. It is done in order to be clear about reimbursements’ value if there is any loss to the cargo or consignment.
- Port Risk Plan-This port risk plan is purchased so that the safety and security of the ship is ensured while it is stationed in a port.
- Wager Plan-A wager plan comes with no fixed terms of reimbursements. In case the insurance provider finds any damage(s) worthy of the claims then the reimbursement is provided. If the damages aren’t found worthy there isn’t any offered compensation. Also, it must be noted that a wager plan isn’t a written insurance plan and it isn’t valid in a court.
- Floating Plan-In a floating plan, solely the claim amount is defined and all the other details aren’t disclosed till the time the ship embarks on a voyage. Hence, it is recognized as a floating plan. For the clients who undertake cargo transportation trips on a frequent basis through the seaways, it is an ideal marine insurance plan.
What is the Coverage Offered by Marine Insurance?
The marine insurance plan covers any damages or losses to the insured property due to the factors mentioned below.
- Fire or explosion, stranding, sinking etc – One can’t predict these situations in advance. Fire or explosion, sinking, stranding are common issues faced during a cargo journey. A marine insurance plan is formulated to take care of such dire situations.
- Collision, overturning or derailment of land conveyance – Sometimes, no matter how hard the captain tries, he can’t take control of unfavorable damage causing situations. Having a marine insurance plan neutralizes the risk of damages caused by collision, overturning or derailment of land conveyance.
- Discharge of cargo at port of distress – If a cargo is a discharged from a port of disturbance or distress, it threatens the safety of the cargo. This is the reason why it is included in the basic insurance coverage.
- General average sacrifice salvage charges – A marine insurance plan provides coverage for general average sacrifice salvage charges.
- Expenses such as survey fees, forwarding expenses, reconditioning costs and sue charges – These expenses are unexpected at times which leaves you with little time to pay for these expenses. This is why having a marine insurance plan is of great help.
- Jettison or washing overboard – Situations of jettison and washing overboard are included in a marine insurance plan.
- Earthquake or lightning – A marine insurance plan provides you coverage from natural calamities such as earthquake or lightning.
- Total loss of package lost overboard or dropped in loading or unloading – No matter how irksome a package loss can be, every time you can’t create a foolproof plan to prevent this situation when your package is being transported in a cargo. This is why it is included in a basic marine insurance plan.
What is not covered in Marine Insurance?
The marine insurance plan doesn’t cover any damages or losses to the insured property due to the factors mentioned below.
- Loss or damage attributed to willful misconduct of the insured – If the misconduct is intentional then your insurance provider can’t do anything about it.
- Insufficiency or unsuitability of packaging of the cargo insured – When the packaging quality of the cargo is not up to the mark that is why it is excluded from the basic insurance coverage.
- Loss or damage due to any financial default or insolvency of the shipowner etc – Any damage due to bankruptcy, insolvency, financial default etc. isn’t covered by insurance providers.
- Ordinary leakage or wear and tear of the goods insured – These situations aren’t covered because of the obvious reasons. A marine insurance plan adds an extra layer of security but some damages pierce this layer and aren’t covered in the basic insurance plan.
- Loss caused due to delay of the cargo – The reason behind the delay can be anything. If the loss is caused due to the delay of the cargo, it isn’t covered in an insurance plan.
- War and SRCC (Strikes, Riots, and Civil Commotion) – These factors are beyond the control of humans. Also, one can’t predict these situations in advance. One can just hope that he/she don’t come across any situation where he/she has to deal with such unfortunate situations.