Types of marine insurance , Importance and benefits

Marine insurance provides cover for damage to ships, boats, terminals, yachts, and most importantly, cargo during a voyage or movement. The only purpose of insurance is to reduce the risk, marine insurance does the same.

During a voyage the ship is surrounded by a variety of hazards. For example, a ship may sink due to a storm or it may hit another ship or a ship may sink or damage due to the storm. Cargo companies purchase marine insurance to withstand losses in such situations.

The insurance company can pay the claim amount based on the loss or the insurer and the policy holder agree to an agreed price by mutual agreement. Where is this type of policy called 'agreed value policy'.

What is marine insurance?

Marine insurance, as the name itself implies, is meant to provide protection to ships, boats, terminals, yachts, and cargo. It is a legal contract between the insurance company and the policy holder. In which the policyholder pays the fixed amount as premium to the insurance company and in return the insurance company compensates the ship and its baggage during the voyage.

What is the importance of marine insurance?

Marine insurance is a safe haven for shipping companies as it helps reduce financial losses due to the possible loss of cargo. Maritime insurance is very important because through maritime insurance, ship owners and transporters can be sure to claim damages, especially given the mode of transportation used.

Ships, boats and such vehicles are very expensive. Naturally, repairs after an accident will also cost a lot or if the ship sinks during a storm, the company suffers a lot of damage. A cargo company selects marine insurance to deal with losses in such situations.

Similarly, if the company's ship collides with another ship, in such a situation the company has to compensate for the other ship. In such a situation, marine insurance is also useful.

Marine insurance is a life saver for transporters and shipping companies as it provides protection from various types of financial loss, property damage.

Types of marine insurance

There can be many types of marine insurance, but here we are telling you about 5 types of marine insurance.

Cargo Insurance

In this policy, cargo is provided protection. The loss of cargo or its goods during import and export, during loading and unloading, is covered in this policy. Cargo insurance has two types of plans: open cover and single cover.

open cover : The term of an insurance policy in open cover can be 1 year or less / more. Such a policy is good for companies that keep on traveling throughout the year.

Single cover: Single cover policy is good for companies that make very few visits in a year. In such a policy the insurance cover is for one trip only. The policy cover ends once the goods are safely delivered and returned.

Liability Insurance

this policy cover is provided for the liability of third party loss by ship. For example, if a ship hits another ship, in this case a claim can be made to compensate for the loss of the other ship.

Freight Insurance

When you ship your goods from a cargo ship, the shipping company provides limited insurance cover, for example, damage to the goods inside the packing is not covered. But if you want, you can protect your goods completely by purchasing freight insurance and taking additional insurance cover.

Hull Insurance

Hull insurance provides cover for the ship and each of the machinery it has engaged, equipment. The cover is provided only for a journey or for a fixed period.

Yacht Insurance

Such a policy provides cover for luxury recreational marine vehicles such as yacht.

What is covered in marine insurance?

  • Compensation for damage caused by fire or explosion
  • If the ship sinks due to damage
  • Land reversal or derailment
  • Offshore and offshore assets such as ports, terminals, carriers are also covered under risk coverage.
  • Compensation for loss during cargo discharge at port
  • Getting stuck in the pot, grounding, sinking or capping
  • Compensation for damage caused by a collision to another ship and compensation to third parties
  • Compensation for damage due to external object water
  • Make up for the usual losses

What does marine insurance not cover?

  • Damage due to intentional mistake is not repaid by the insurance company.
  • Loss, damage or expense due to delay and implied vice
  • nature of goods
  • Simple leaks, damage to insured items over time, are not covered.
  • Improperly packed packing does not cause damage
  • Intentional compensation is not made for any ship or similar damage
  • Owners, managers, charters do not get cover for bankruptcy or financial default
  • Damage arising from the use of nuclear weapons is not covered.
  • Damages caused by nuclear or radioactive materials are not covered.

Who can buy marine insurance?

Any type of marine vehicle (ship, yacht, yacht and cargo) or any person wishing to protect themselves during the journey can purchase such insurance. Any of the above types of marine insurance policy can be taken as per requirement.

How does marine insurance work?

Marine insurance covers the loss or damage of ships, cargo, terminals, and any transportation by which property is transferred, acquired, or held between points of origin and final destination. ... When the goods are transported by post or courier, shipping insurance is used instead.

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