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The benefits of marine cargo insurance aren’t always obvious until it’s too late. As reliable as vessel transportation can be, the possibility of disaster always lingers with every shipment. Insurance can protect ocean freight shippers in more ways than one when they import or export their goods.
According to the data organization FreightWaves, ocean freight cargo can fall overboard or even catch on fire. The benefits of marine cargo insurance for importers and exporters include:
These benefits are crucial for protecting your business.
We’ll cover the benefits of marine cargo insurance and some of the dangers that will make you want to obtain it.
Ocean shipping is the most common form of transportation used in international trade. Transit times might be long, but it’s a reliable and economical way to send goods overseas. Nonetheless, transporting goods overseas via vessel does come with certain dangers.
The following scenarios often can cause damage or loss of ocean freight:
Maritime accidents fluctuate from year to year, but the data shows that there’s always a chance your shipment could be caught in one.
| Year | Losses |
| 2016 | 99 |
| 2017 | 95 |
| 2018 | 53 |
| 2019 | 48 |
| 2020 | 49 |
Source: Insurance Information Institute
Shippers, port workers and vessel crew members do their best to prevent these scenarios from happening. That said, accidents can still occur and being prepared for them is imperative.
Marine cargo insurance is mainly known for the benefits it offers to shippers after their freight sustains damage. However, marine insurance is helpful even when freight arrives perfectly safe.
Each of these benefits makes ocean freight shipments a smoother experience for shippers to go through.
Before an international transaction is made, importers and exporters decide who is responsible for the goods while they’re in transit. Regardless of who it is, marine cargo insurance can save them an exceptional amount of money if loss or damage occurs.
Marine cargo insurance can reimburse the importer or exporter for any financial losses that the shipment sustains. Additionally, marine insurance covers the cost of shipping. Insurance companies are always willing to negotiate the amount of the deductibles with importers and exporters, which makes the cost of insurance more reliable.
Having the appropriate amount of coverage is important since there are so many dangers that threaten ocean freight shipments. Marine cargo insurance is designed to cover a wide range of events.
Marine cargo insurance can provide financial protection from:
This wide range of risk coverage gives importers and exporters the comfort of knowing that they’ll be compensated for most kinds of undesirable scenarios.
Shipping freight can be a very stressful endeavor. This stress is only amplified when the freight being transported is of high value and when the final destination is half a world away. Marine cargo insurance can provide shippers with a sense of reassurance and peace of mind.
Even if something goes wrong, shippers know they won’t be left in financial ruin.
Another benefit of marine cargo insurance is that making a claim is easy to do. Marine cargo insurance policies outline the steps that importers and exporters have to take if their freight suffers damage while in transit. This makes it easier for them to obtain the financial compensation that they’re owed.
When filing a claim, you will need to follow these steps:
While these steps might seem lengthy, insurance companies are always willing to help you through these steps so that you can successfully file your claim.
The coverage provided by marine cargo insurance no longer applies once the shipment reaches land. However, there is another type of marine insurance that protects goods when they’re being moved by another mode of transportation. This type of policy is called inland marine insurance, and it extends coverage to goods transported by land and rail.
Inland marine insurance has many of the same benefits as normal marine insurance. This allows importers and exporters to have full protection for the entirety of the shipping process.
Marine cargo insurance is not a legal requirement for shipping freight internationally. That said, there are quite a few reasons why importers and exporters choose to insure their ocean freight shipments anyways.
These reasons include:
As we’ve already mentioned, many risks accompany importing and exporting. These risks influence international shippers to obtain protection for their goods. In some cases, buyers and sellers rely on Incoterms to determine who is responsible for insuring the shipment.
Incoterms are guidelines that two parties abide by when they’re conducting a transaction. Some of them determine which party is responsible for insuring the goods. If one of these Incoterms is used, the party responsible for insuring the goods will need to abide by them or risk breach of contract .
Freight Insurance Coverage will protect all shipments that you book with us. International and domestic shipments are given a supreme level of protection. You won’t have to worry about asking us to apply insurance to your shipments.
We immediately apply insurance coverage to all the goods we ship for our customers. The price of the insurance is then factored into the overall shipping cost and reflected in your quote.
If you’re ready to ship your goods with the protection they deserve and need, then fill out a risk-free quote today. You can also contact our team members at (866) 975-2713 with any questions or concerns.
Freight Insurance Coverage
315 NE 14th Street #4122
Ocala, FL 34470
