What is Marine Cargo Insurance?
Marine Cargo Insurance provides coverage against any damage caused to cargo vessels which are in transit by road, rail, inland waterways from one point to another. The policy covers damage incurred to the cargo while it is grounded or in transit due to other factors like weather conditions, strikes, war, collision, sinking, navigation errors etc.
What does Marine Cargo Insurance Cover?
What’s not Covered?
Digit’s Marine cargo insurance policy does not cover for the mentioned points:
Damage attributable to the wilful misconduct of the insured.
Expenses incurred for everyday wear and tear, ordinary loss in weight/volume or leakage.
Damage caused by insufficiency of packing or preparation of the subject matter insured to withstand the ordinary incidents of the insured transit.
Damage caused by delay even though the delay is caused by a risk insured against.
Damage caused by inherent vice or nature of the subject-matter insured.
The insurance policy will not cover damage or expenses caused by people taking part in labour disturbances, riots or civil commotions.
Damage is directly or indirectly caused by or arising from the use of any weapon or device employing atomic or nuclear fission and/or fusion or other like reaction or radioactive force or matter.
The policy will not cover the expenses incurred for damage caused due to unseaworthiness of the ship that is used for safe carriage of the subject matter insured.
Damage caused due to war, revolution, rebellion will not be covered under the insurance policy.
Damage caused by insolvency or financial default of the owners, managers, charterers or operators of the vessel was at the time of loading of the subject matter insured on board the vessel, the assured is aware or in the ordinary course of business should be mindful that such insolvency or financial default could prevent the routine prosecution of the voyage.
Features of Digit's Marine Cargo Insurance
All insurance policies come with specific features. Listed below are the ones for the marine cargo insurance policy offered by Digit:
A marine cargo insurance policy offers comprehensive coverage for all potential perils. It ensures that goods exposed to damage are covered under the insurance policy.
The insurance policy comes with various options and is flexible. Policyholders can choose a policy as per their requirements and their budget.
The policy comes with an easy claim settlement policy. This feature frees the policyholder from stress as worldwide claims settlement assistance is offered.
As the policy comes with flexibility, you can customize the plans and adjust them as per your needs.
The policyholder has the liberty to enhance the coverage with add-on benefits. The feature ensures that you are protected from risks arising due to factors like riots, strikes, etc.
Who needs a Marine Cargo Insurance policy?
A marine cargo insurance policy can be bought by -
Those who sell goods can avail themselves of this policy as they need to transport goods to different parts of the country.
Contractors can also avail of a marine cargo insurance policy.
The policy can also be availed by those involved in the import and export of goods or transport across the country.
How is the premium calculated for Marine Cargo Insurance?
In Marine cargo insurance, the premium is calculated based on the factors mentioned below:
The premium will be high if the transported goods have an increased risk of damage. Given that, extra caution needs to be taken to transport the goods, the premium charged is high.
The mode of transport used to get the goods from one place to another is another factor that impacts the premium for the policy. As different modes of transport involve different types of risk, the premium varies.
The payable premium also depends on the type of vehicle which is used for transporting of goods. The payable premium will be high if the used vehicle is a large one and involves high risk.
The age of the vehicle also impacts the premium charged for a marine cargo insurance policy. The premium will be on the higher side is the vehicle has been in use for a long time as the chance of wear and tear and associated risks are high.
The payable premium is also impacted by the cost of the vehicle used to transport the goods.
The limit of trading and tonnage also impacts the policy’s premium. If the limit is high, the premium will be high and vice versa.
The kind of insurance cover you opt for also impacts the policy premium. Like the points mentioned above, the more extensive the coverage, the higher is the payable premium.
Before calculating the policy’s premium, ownership and management terms needs to be taken into account. It plays an important part when determining the payable premium.
How to choose the right Marine Cargo Insurance policy?
When choosing the right Marine cargo insurance policy, certain factors that need to be considered. They are listed below:
Insurer’s reputation – You need to look into the insurer’s reputation from where you are planning to buy the insurance policy. Doing this, will enable you to make sure that there are no issues during claims.
Robust marine claim department - Another thing to consider is whether the insurer has a healthy maritime claim department. It is essential because you don’t want your claim application stuck at their table.
Affordable premium – The payable premium is another factor that needs your attention. You don’t want to pay a higher premium for your coverage
The coverage you need – When availing yourself of marine cargo insurance, you need to consider the coverage it offers. This will ensure that you get a policy that provides the coverage you want and not one just for the sake of it.
Surveyor & Assessor network - When choosing the right Marine Cargo insurance policy, it is important to look at the surveyors and assessors network of the insurer. This is because if the claim goes beyond a certain defined limit, an assessor visits you to determine the exact damage.
FAQs about Marine Cargo Insurance in India
Does marine cargo insurance cover damage caused by natural disasters?
Yes, damage caused by natural disasters like earthquakes, lightning, storms, etc., is covered under a marine cargo insurance policy.
What are common types of marine insurance?
The common types of marine insurance are – hull insurance, freight insurance, marine cargo insurance, and liability insurance.
Can a marine insurance policy be assigned?
Unless mentioned otherwise in the terms and conditions, a marine policy can be assigned.
What are the principles of marine insurance?
The marine insurance policy is generally based on six principles: good faith, indemnity, insurable interest, proximate cause, contribution, and subrogation.
Is delay in transportation covered under the cargo insurance policy?
No, a cargo insurance policy does not cover delays in transportation.
How many types of cargo insurance policies are there?
There are four types of cargo insurance policies. They are – Annual policy, specific voyage policy, open policy, and open cover.
What is the duration of a time policy under marine cargo insurance?
In marine insurance, a time policy is generally issued for a year. While it can be extended to complete a specific voyage, the policy can be issued only once a year in India.
How does a specific voyage policy work?
This type of cargo insurance policy is issued before the transit starts and ceases immediately on the completion of the voyage. It is suitable for the transportation of goods on a single journey.
Is marine cargo insurance limited to only water transport?
No, marine cargo insurance is not limited to only water transport. The policy also covers cargo transported via road, rail, and air.
Which mode of transports are included under Marine Cargo Insurance?
Marine Cargo insurance policy offers coverage for cargo transported by road, rail, sea and aircraft.
How is marine insurance different than marine cargo insurance?
While marine insurance offers coverage for cargo transported via waterways, marine cargo insurance offer coverage for cargo transported using other modes of transport.