Marine Cargo & Transit Insurance
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Annual Marine Transit Insurance
For over 20 years we have been arranging Marine Cargo & Transit insurance and can provide cover for a wide variety of goods being transported by Sea, Air, Road and/or Rail. If you are looking to import or export goods, our experienced team are here to help.
Our insurers use the following key factors when considering premiums:
– Nature of Goods
– Value of Goods
– The Regions Goods are Going To and From
– Previous Claims/Loss History
Furthermore, we can provide cover for single or multiple containers. You would just need to ensure that the maximum value any one conveyance is sufficient to cover your goods on a Cost Price + Freight Costs + 10% basis.
If you would like a no-commitment quote to insure your goods, simply complete our quote enquiry form below:
If you’re not sure whether an Annual policy or a Single Shipment policy best suits your requirements, we will gladly provide quotes for both options.
Our frequently asked questions below may also assist you in deciding what cover you need.
My Goods Are Going By Sea and Road – Is Marine Cargo Insurance Suitable?
The terms ‘marine transit’ and ‘marine cargo insurance’ can be somewhat confusing. Your goods don’t need to be transported by Sea for a marine transit / cargo insurance policy to be suitable! Originally, marine cargo insurance protected merchants in the 17th century sending goods abroad by Sea. However, nowadays Road, Rail and Air are equally important means of moving goods. Whilst the means of transport covered by marine cargo insurance have changed over the years, the class of insurance is still referred to as marine cargo or marine transit insurance.
What’s important to realise is that the presence of the word ‘marine’ doesn’t restrict the means of transport. In many instances goods will start their journey by Road or Rail. After that, they are loaded aboard on to a vessel or plane for the Sea or Air transit. Then, with the final movement to the destination being by Road or Rail. So marine cargo cover will insure the entire movement irrespective of the means of transport and a number of different means.
Why Would I Need to Arrange Marine Cargo / Transit Insurance?
If you import, export and/or send goods domestically, it’s important to check who is responsible for insuring. As well as, check the level of cover afforded before a loss happens. Many people think that a carriers insurance will cover goods, however that’s not always the case!
UK: UK Goods in Transit
For UK: UK goods in transit, RHA Conditions of Carriage provide restricted financial liability. In addition, only cover a carrier’s legal liabilities, excluding Acts of God. Specifically, the standard RHA limitation of £1,300 per tonne can result in significant uninsured losses where separate marine or goods in transit insurance isn’t arranged.
Unfortunately, we know of instances where product manufacturers, precision engineers, finishers and other sub-contract service providers have suffered losses in transit. Only to discover that the RHA conditions of carriage only covered a fraction of the actual value of goods damaged or lost. Therefore, the incorrect assumption that carriers / hauliers provide adequate cover can be an expensive one. This is because hauliers tend to only offer a very low level of cover as standard.
When goods are going to/from Europe, the Hauliers liability is limited to CMR Conditions of Carriage. Unless cover is arranged on an All Risks basis, there are many clauses within CMR Standard Conditions. Supporting the haulier in the event of a claim, including (but not limited to) negligence.
By understanding the scope of cover afforded by your carrier, you can then evaluate any gaps in cover. In addition, decide the level of financial risk you are willing to take. Therefore, by having a marine cargo insurance policy, you have peace of mind of knowing that your insurer would provide indemnity in the event of a claim. As well as, knowing that recovery from the carrier in accordance with the terms and conditions applicable, would be a matter handled by their recoveries department.
If using a freight forwarder, it is important to check what Conditions of Carriage apply. Many UK freight forwarders operate under BIFA Standard Trading Conditions, which limit the carriers liability.
Under BIFA the freight forwarder can either be the Agent or the Principal if:
They are the Agent, then they are authorised by the insured to enter into any and all contracts to get the goods from A to B.
They incorporate the conditions and contract within 14 days to the customer. Then in the event of a claim, the owner of the goods has to go to all the subcontractors the freight forwarder has provided to get a settlement.
The terms and conditions aren’t incorporated within 14 days. Then the freight forwarder automatically becomes Principal. So, you can go after the freight forwarder for recompense. However, they may still direct you to the Haulier involved.
N.B. BIFA also excludes cover for General Average.
What is General Average and Why Would it Affect Me?
General Average is a historic principle. It dates back to times when marine cargo insurance related solely to goods been carried by sea. In heavy seas, cargo may shift or the sheer weight of the total cargo carried. Therefore, it could put a ship in danger of sinking. In such instances a decision may be made to jettison some of the cargo to protect the ship. As well as, its crew and the remaining cargo.
The principle of General Average was devised to recognise and compensate the merchants, whose goods were sacrificed for the benefit of the rest. Under General Average, each of the merchants whose goods are saved, compensate the owner of the lost goods, in proportion to the value of their own goods at risk.
This principle of General Average remains in force to this day. Therefore, a ship may have to jettison some cargo so that the voyage can be completed. After that, all the goods that have safely arrived have to pay a proportion of the goods jettisoned. Plus pay towards the damage to the ship, as well as costs based on the value of your goods. You also have to pay a bond for the goods before they are released at the port.
Isn’t it Best for the Freight Forwarders to Arrange Cover?
Marine cargo insurance can be arranged by freight forwarders. However, the freight forwarders terms and conditions would need to be understood and incorporated within the freight forwarders insurance policy. Losses would be limited to the maximum amount under those trading terms. It is important to note that under BIFA terms, marine cargo insurance must be requested in writing by the cargo owner. In the absence of any instruction in writing the forwarder may legally assume that it is not required.
The Seller Arranges the Insurance so Why Would I Need Separate Cover?
Since many goods are imported from the Far East, let’s consider an example of goods being imported from China under CIF Incoterms (Cost Insurance Freight).
The seller has an obligation under the Incoterm to provide insurance and charge for it in the overall sale. You should note, however, that under CIF Incoterms® 2010 rules, it is acceptable for the seller to provide minimum cover (Institute cargo clause C cover). Therefore, satisfying its contractual obligation for insurance.
So, if you are purchasing goods on a CIF basis, you would be well advised to check the insurance you are being offered. Additionally, request Institute Cargo Clause A cover, if there are no valid reasons why such cover can’t be provided. N.B. Even where companies arrange their own marine insurances, their policy may stipulate that all sellers must provide Institute cargo clause A cover.
If looking to rely on the Sellers insurance, it would also be prudent to consider:
– Where are the insurers based?
– Are the insurers regulated?
– Are they sustainable?
– Would you be able to communicate in a common language in the event of a claim?
Benefits of Arranging Your Own Marine Cargo / Transit Insurance
There are many complexities surrounding terms and conditions of carriage. Therefore, many companies choose to arrange their own marine cargo insurance cover. Ordinarily, Marine Cargo Policies in the UK are written on A Clause, by insurers who are A rated and regulated, with claims settled in the UK and the policies include General Average cover.
By having your own policy, if a claim is covered then it will be paid. Additionally, your insurers will recover what they can from the hauliers and/or freight forwarders involved. You also have the benefit of direct communications with your insurers. In addition, you’ll have clarity in terms of the scope of cover afforded and will not have to wait for a claim to be subrogated to be indemnified. Having your own marine cargo insurance policy provides peace of mind. It also frees up your time in the event of a loss enabling you to focus on running your business.
For more tips and advice, visit our Frequently Asked Questions section now, or if you would like a no-commitment quote to cover your imports, exports and/or domestic transits, simply complete our quote enquiry form below:
If you’re not sure what your requirements are, we will gladly discuss with you to ensure that your financial interests are best protected. Please Call us on 01384 442 165 (Mon-Fri, 9am-5pm). Or Email: email@example.com. We can provide same day quotes for most shipments.