How Marine Insurance Helps During Transit Losses?

Success in the business of transportation and shipment only happens when most of your goods or cargo reach their final destination without any damage. However, it is well known to everyone in this business that risk is an integral part of marine transportation. Several factors can lead to the loss or damage of goods or cargo in transit, including theft, collision, and natural disasters. That is why, to protect the shipment in transit, having transit insurance is necessary.

However, what is more important is to understand the type of losses it protects against, so that businesses can derive the maximum benefit from their insurance.

What is Marine Cargo Insurance?

Under the Marine Act 1906, marine cargo insurance is defined as a legal contract between an insurance company and the policyholder in which the company promises to provide coverage against any damage or loss that may occur during transit.

How Marine Insurance Helps During Transit Losses?

There are several types of transit losses that marine insurance covers; here are some of them:

Loss Due to Theft

The transit insurance provides coverage against the loss of goods due to theft; for example, shipment theft by seamen will be compensated under marine cargo insurance.

Total Loss Due to Loading or Unloading

There have been several incidents where accidents during the loading or unloading of goods have caused damage. In such events, marine cargo insurance is extremely helpful to cover the loss of goods.

Vessel Collision Loss

Accidents like a collision between two cargoes do happen in the transportation business, and the loss of goods and vessels in such events is covered by marine cargo insurance.

Malicious Damage

Intentional damage to the goods by anyone other than the policyholder or their employees will be covered under the transit insurance.

Land Conveyance Mishaps

Transportation of goods via land vehicles is also possible, but it can cause damage or loss of shipment. In case of collision, derailment, or overturning of land vehicles carrying goods, coverage will be provided.

Explosion, Fire and Lightning Protection

Marine cargo insurance provides essential coverage for incidents like explosions, fire and lightning that cause damage to transit goods.

Earthquake or Volcanic Eruption

Natural disasters are unpredictable and can happen at any time. In case of loss of goods due to an earthquake or volcanic eruption during cargo transit, the marine cargo insurance will provide coverage.

Vehicle Overturning Coverage

The transit insurance also covers the loss of goods due to overturning or derailment of the vessels carrying them.

Water Ingress Protection

The marine cargo insurance provides for the loss or damage of goods due to the entry of river, sea or lake water into the watercraft carrying the goods. It excludes damage due to rain.

Bridge Breakage

The marine cargo insurance protects the shipment in the event of a bridge breakage in transit.

Grounding, Sinking, Stranding Coverage

Transit insurance also helps in covering the loss or damage of goods due to grounding, sinking or stranding of the ships during transit.

Delivery to Different Locations

The marine cargo insurance provides coverage for goods or cargo unloaded at a different location than the one specified due to adverse weather conditions (with the insurer’s notification).

Washing Overboard Coverage

In case of loss or damage of goods due to the sweeping of tremendous waves of the ocean that take away goods during transit, transit insurance covers all the loss and damage.

General Average Sacrifice Salvage Charges

The marine cargo insurance also compensates for the sacrifices and salvage expenses made during the maritime emergencies to save the vessel or goods.

Contact of Vehicle Carrying Goods

The transit insurance providers also cover the loss or damage caused by the goods-carrying vessel in case it comes in contact with any animal or structure, etc.

Natural Calamities Protection

Marine cargo insurance also protects against the impact of natural disasters, such as earthquakes, lightning strikes, cyclones, and floods.

Jettison

The transit insurance also provides coverage for the intentional throwing overboard of cargo to prevent more damage to the vessel or goods.

Summing Up

The world of the transportation business is unpredictable and full of surprises, some of which might cause loss. That is why having marine cargo insurance is crucial to safeguard your goods and finances against loss or damage, like natural calamity, theft, jettison, vehicle overturning, collision, etc. Businesses who are looking for a good marine insurance provider must know about TATA AIG marine insurance, who provide financial protection against cargo loss, cargo protection specific voyage risks, and offers customisable options.