Transportation through the ocean is responsible for most of the world’s trade, which means about tons of cargo moving across the globe each year.
The transportation of containers through shipping is cost-effective and also a safe way of moving goods. However, some risks come with cargos shipping, but you can always take precautions by buying Marine Transit insurance and safeguard yourself.
What Is Marine Transit Insurance?
It is insurance which helps you cover the loss or damage caused to ship, terminals and any transportation vessel or cargo by which goods are transferred, attained or held between the base port and final stoppage. These transit insurance policies are made in such a way so that you can minimize financial loss incurred because of an accident, natural disaster or any other mishappenings.
This policy also helps policyholders cover losses including onshore and offshore exposed property, hull, Marine casualty and Marine liability.
What Are The Risks Involved?
There are generally two types of risks against which you get payment against your goods in transit insurance these are:-
- Risks related to your consignment can occur due to –
- Packaging – When the goods being transported are poorly designed or inappropriately packed, they may get damaged while shipping.
- Theft – The cargo may get stolen during transportation.
- Improper Handling -While loading and unloading cargo using cranes or forklifts, they can be damaged.
- Risk related to vessels-
- The vessels may get misplaced, lost or delayed.
- Fire may break.
- There can be a collapse of stacks on the container ship.
- The vessel can collide with each other.
- Natural disasters can also result in losing or damaging containers because of strong winds.
- Political unrest and Piracy.
Different Types of Cargo Insurance
There are three types of MTI available for you, which will cover a different amount of risks:
1: Institute cargo clause
- This one gives you the maximum coverage. It is also the “All risks ” cover as you don’t need to prove the accident or carrier liability.
2: Institute Cargo Clause:
- It gives restrictive insurance coverage against your loss. It covers:
- Loss or damage to the subject insured caused by average general sacrifice
- Jettison or washing on board.
- The entry of sea or river water into a vessel or place of storage
- Full loss of any goods lost overboard.
- Package dropped while loading or unloading from vessel or craft.
3: Institute cargo clause:
- This coverage will get you insured for only limited things; you can get repayment if there is:
- Loss or damage to the subject insured fairly chargeable to.
- Explosion or fire.
- The vessel being grounded, stranded, submerged or capsized.
- Cancellation or derailment of land conveyance
- Collision or contact of vessel or conveyance with any other external object but not water
- Release of cargo at a port of distress.
- Loss of or damage to the subject matter incurred caused by.
- General coverage sacrifice.
When you take Marine Transit insurance, it will be beneficial for your business.