The word ‘marine’ in marine cargo insurance is a misnomer. It indicates to the uninitiated that this type of insurance only covers goods transported by water. Where in reality, marine cargo insurance covers goods being shipped by sea, air, road, or any other mode of transportation. Cargo insurance Cyprus

Marine cargo insurance is a must-have for cargo owners, shipping corporations, and ship owners to protect their interests. Furthermore, in most cases, the export contracts require the exporter to obtain marine cargo insurance. Or else, the export contract won’t come into effect.

Here is what this article will cover:

• How does marine cargo insurance work?
• Types of marine cargo insurance policies.
• What does marine cargo insurance cover?
• What to look for when purchasing marine cargo insurance?
• Important clauses in marine cargo insurance policies.
• Frequently asked questions about marine cargo insurance.

How does Marine Cargo Insurance Work?

Marine cargo insurance transfers all the liability from the insured to the insurer. That means that the insurance provider will offer financial compensation in case the cargo gets damaged or lost in transit, with the exporter not liable for any losses.

As stated earlier, the vast majority of export contracts place an obligation on the exporter to purchase marine cargo insurance. This is done to make sure that the purchaser/consigner’s interests/property are adequately protected.

Types of Marine Cargo Insurance Policies

Marine cargo insurance policies usually come in three types:

Specific Policy

Under the terms of the specific policy, only a single specific shipment is covered against theft, loss or any other kind of damage mentioned in the policy. The protection will be available for the time period stipulated in the policy.

Open Policy

The open policy allows the proposer and the insurer to strike an agreement under which all the goods falling within that agreement will be covered for a specific period. Open policy also allows the agreement to continue indefinitely, pending the assent of both parties.

Open Cover

The open cover policy is an agreement in which the proposer agrees to buy marine cargo insurance for all the cargoes that place them under an obligation to purchase the insurance. Under the terms of open cover policy, the insurer also agrees to provide cargo protection for the insurer.

What does Marine Cargo Insurance Cover?

Depending on the policy purchased, your marine cargo insurance might compensate for the loss or damage to your goods attributable to various risks. These risks include but aren’t limited to:

• Fire.
• Sinking of the vessel.
• Accident to the conveyance carrying the cargo.
• Loss of package during loading/unloading from the conveyance.
• Terrorism, piracy, war, strikes.
• Earthquake.

Unless stated otherwise, packing of your goods or merchandize isn’t covered under marine cargo insurance. If you want to have your packing materials covered, you may have to ask the insurance provider to add a special clause to your policy.

What to Look for When Purchasing Marine Cargo Insurance?

Here is what you need to consider when buying marine cargo insurance policy:

Coverage

It is a no-brainer that your marine cargo insurance policy must cover all the risks that may arise during the cargo’s journey. These risks include but aren’t limited to fire, accident, piracy, earthquake, etc.

Premium

When purchasing a policy, strike a balance between the insurance cover and premium. That means that while your premium shouldn’t be so high as to become unaffordable. It should neither be too low to deprive you of much-needed coverage.

Exclusions

Even the priciest policy plans will have a sizeable number of entries under the exclusions tab. So, before you sign on the dotted line, read the entries under the exclusions tab and make sure they aren’t of importance to you.

Claim settlement process

How early/easily the insurer’s settles claims? To get an answer to this question, consult parties who have prior experience of dealing with the insurance provider. Steer clear of insurers that willingly delay claim settlement.