Marine insurance – Meaning, types, benefits & coverage.
Question - Do I need to add marine insurance to my freight when shipping goods from my manufacturer?
Answer: That’s a great topic and it has many aspects.
To give a straight answer- Proboxx highly recommends to add marine insurance for any freight. You get to sleep well at night knowing your goods are covered.
What is Marine Insurance?
Marine insurance refers to a contract of indemnity. It is an assurance that the goods dispatched from the country of origin to the land of destination are insured. Marine insurance covers the loss/damage of ships, cargo, terminals, and includes any other means of transport by which goods are transferred, acquired, or held between the points of origin and the final destination.
The term originated when parties began to ship goods via sea. Despite what the name implies, marine insurance applies to all modes of transportation of goods. For instance, when goods are shipped by air, the insurance is known as the contract of marine cargo insurance.
Importance of Marine Insurance
Marine insurance is required in many import-export trade proceedings. Admitting the terms, both parties are liable for the payment of goods under insurance. However, the subject matter of marine insurance goes beyond contractual obligations, and there are several valid arguments necessary for buying it before dispatching the export cargo.
How Does Marine Insurance work?
Marine insurance best transfers the liability of the goods from the parties and intermediaries involved to the insurance company. The legal liability of the intermediaries handling the goods is limited to begin with. The exporter, instead of bearing the sole responsibility of the goods, can buy an insurance policy and get maritime insurance coverage for the exported goods against any possible loss or damage.
The carrier of the goods, be it the airline or the shipping company, may bear the cost of damages and losses to the goods while on board. However, the compensation agreed upon is mostly on a ‘per package’ or ‘per consignment’ basis.
The coverage provided may not be sufficient to cover the cost of the goods shipped.
Therefore, exporters prefer to ship their products after getting it insured the same with an insurance company.
Reach out to us today if you need help with your marine insurance HERE.