Cargo Insurance

Cargo insurance is a legal contract between the insurer and the policyholder. It is designed for individuals involved in import & export business and use cargo ships, airplanes, trains, etc. to transport their goods from one place to another must purchase this policy. A marine cargo insurance policy is one of the best insurance covers that will help you safeguard your valuable cargo anywhere in the world. A cargo insurance policy will protect your cargo from any loss or damage caused during transit via road, sea, rail, or air.

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What is Cargo Insurance?

Cargo Insurance policy is designed to provide indemnity cover for goods/cargo carried through different modes of transport and transit. A lot of money goes in packaging and transporting shipments. And any loss or damage would mean a huge loss. To cover up such losses, it is important to have cargo insurance in place.

Freight insurance can also be taken for goods during shipment. It helps in mitigating the risks related to the shipping process and helps you ship your goods in a secure manner. You can buy freight insurance directly from the shipper or an insurance provider.

Types of Cargo Insurance Policies

There are various types of cargo insurance in India. You can buy cargo insurance cover that suits most of your requirements such as import, export, transit within India, single voyage etc. Let’s have a look in detail-

  • Open Cover- An open cover cargo insurance policy is suitable for goods that are imported and exported. It is issued on a contractual basis for a period of 12 months. Under open cover cargo insurance, the insurance provider agrees to cover all the shipments that are within the scope of coverage. An open cargo insurance cover policy is based on an unstamped agreement.
  • Open Policy- This cargo insurance policy is issued to cover the transit of goods within India. An Open policy is valid for a year. It covers all the goods in transit that are declared by the policyholder, which is subjected to the overall sum insured limit. It is issued on a stamped document. And stamp duty is taken in advance along with the premium. Usually, the premium is collected in advance for the complete estimated value during the policy term. In such cases, specific cargo insurance policies are not issued for each shipment.
  • Specific Voyage Policy- This type of cargo insurance cover is suitable for a single transit or voyage. The policy is generally issued before the transit starts. On completion of the voyage, the coverage will cease immediately. The specific voyage policy usually contains all the details of Vessel name/conveyance/ Bill of Lading/ Waybill and date along with policy terms, conditions, and sum insured details similar to the other marine cargo insurance policies.
  • Annual Policy- This type of cargo insurance policy offers coverage to goods in transit by rail, road, and sea from stated depots or processing units that are hired or owned by the policyholder. It is required that the goods covered must be held in trust or belong to the  These policies cannot be issued to transport operators, freight forwarders, commission agents or to anyone in joint names. Annual policies cannot be transferred or assigned.

Why Do You Need Cargo Insurance?

To save your shipments and recover the money invested in such consignments, it is important to have the goods covered under a cargo insurance policy. It is helpful in the following circumstances:

  • Import and export shipments
  • For goods that are moved from one place to another by river transport
  • For goods being transported by sea, rail, air, road or post
  • Goods being transported by coastal vessels from one port to another
  • Cargo moved by country craft or small vessels over inland waters

Coverage Provided in Cargo Insurance Plans

The insurer will compensate you for any damage that is caused to your shipment due to the specified natural and man-made disasters. Cargo insurance usually covers the loss or damage caused to the property due to the following reasons-

  • Collision
  • Explosion or Fire
  • Sinking or Stranding
  • Earthquake
  • Lightning
  • Jettison
  • Spillover or derailment
  • Washing overboard
  • Any damage during discharge of consignment at the port of distress
  • Salvage charges
  • Total loss overboard or while loading or unloading
  • SRCC and war conditions are specifically covered in some cargo insurance plans

Benefits of Purchasing Cargo Insurance Policy

The major benefits of cargo insurance policies are listed below-

  • Cargo insurance plans are freely assignable
  • The existence of insurance interest needs to be established only at the time of loss
  • Most of the marine cargo insurance policies are based on an agreed value
  • Marine car insurance policies are usually transit policies and  are not restricted to a precise period

Does Cargo Insurance Have Limitations?

The policy does not cover loss or damage to cargo insured due to-

  • Fault in the preparation and packaging of the insured cargo
  • Any deliberate attempt or misconduct by the policyholder
  • Delay of the shipment
  • Ordinary leakage
  • Any ordinary loss in volume or weight
  • Any kind of inherent flaws
  • Financial distress and insolvency of the carriers
  • Ordinary wear and tear is not covered under marine cargo insurance

If you file a claim due to the above-mentioned reasons you will not get compensation under your marine cargo insurance policy.

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Cargo Insurance Reviews & Ratings
4.1 / 5 (Based on 14 Reviews)
(Showing Newest 10 reviews)
Deepak
Delhi, March 08, 2022
Amazing coverage
I have been utilising open cover Cargo Policy for quite some time now. It on contractual basis and this is one that suits my business the most. I like the coverage.
Mahendra
Kolkata, March 03, 2022
Fantastic plan
When it came time to get cargo insurance, we had no problems. It went off without a hitch, and the premiums were quite low. The plan was fantastic.
Kunal
Ahmedabad, February 26, 2022
Good things to say
I ve only had good things to say about my insurance since I bought it here. It s where you ll have to buy your insurance.
Virat
Pune, February 21, 2022
Spillover coverage
There was spill over during the voyage. There were obvious damages. Insurance provided the expenses for the same.
Rishabh
Kochi, February 16, 2022
Specific voyage cover
We took specific voyage insurance as this consignment was for a very spcefic thing. Glad to say everything went well.
Hardik
Chennai, February 11, 2022
Compensation for overboard damage
In our lst insurance when our goods were lost, we didnt recive any compensation. We were cheated by our insurers. This time we have carefully navigated the place we wanted. It has an extensive coverage and when there was an overboard situation, we were compensated for it.
Guddu
Mumbai, February 10, 2022
Cheap premiums
There was no trouble no fuss at all when we had to buy our cargo insurance. It went rather smoothly and the premiums were really cheap as well. Loved the plan.
Udayveer
Noida, February 09, 2022
Annual policy cover
We own a shipment business and need insurance for the goods that we ship. For that we had bought the annual policy for ouselves which is cheaper with a reasonable coverage. We bought it from PolicyBazaar.
Salman
Navada, February 09, 2022
Quick claim settlement
There was a spillage when our cargo was on its way. Obvious losses happened but thankfully we had the insurance. We were able to claim settlement for the insurance we had bought and recived compensation for it.
Manas
Dispur, February 01, 2022
Specific cargo insurance
We had to send a big consignment but only for one journey. So we chose a specific voyage cargo insurance for it. It was only for a single trip so it would close immediately after the delivery. It suited our needs.
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