Transit insurance is important to secure goods in transit from one place to another. It caters to damages and loss caused to goods that are being carried by an individual on his/her private vehicle, or through an employee or driver or third-party carriers.
Transit insurance or transportation insurance policy is a safe and secured way of covering the risk arising due to loss or damage caused to goods or personal belongings while in transit. The cost of the premium is decided based on the goods in transit insurance and the risk the policyholder is bearing during that policy term.
Transit Insurance in India also recompenses damages resulting due to derailment or overturning of the vessel. Transportation insurance also covers loss of goods due to the sinking of the vessel. Nowadays, you can easily buy transit insurance online.
Why is Transit Insurance Required?
A transit insurance plan proves to be most useful for businesses as it offers many advantages. Here are some of the advantages of a transit insurance policy that makes them must buy:
- The coverage offered by transit insurance provides businesses financial support, which may encounter considerable losses when their goods are damaged at the time of transit. In this way, it helps to keep the finances of a business stable even after encountering a loss.
- As mentioned above, the coverage is provided as per global standards, thus even when you are transporting your goods internationally, then as well you can meet with the coverage requirements of that country wherein the goods are headed.
- You can customize the policy as per your business requirements; therefore, transit insurance policy is suitable for almost all types of businesses.
Transit Insurance Coverage
Transit insurance provides a policy that includes compensation against common perils that might cause damage to the items that are being transported. The common perils against which a transport or transit insurance provides protection are:
- Any type of manmade or natural calamities
- The vassal containing goods therein collides and causes damage
- Transport vehicle overturning
- Vessel encounters derailment
- Vessel sinks
- Risks encountered at the time of unloading and loading the goods
- Risks encountered at the time of unpacking and packing of goods
- Malicious damages
- Accidental damages
- Impact damages, etc
Types of Transit Insurance
The various types of transit insurance policies that you can buy are listed below:
- Single Transit - Such policies are designed for business owners who send out shipments occasionally. And the coverage is provided for a single voyage only. As soon as the shipment reaches its destination the coverage will cease.
- Customized Plan - A transit policy can be customized on the bases of the goods type, transaction limitations, location limitations, mode of transportation, and any other specific requirements.
- Overnight Vehicles’ Insurance Policy: If the goods have to be stored overnight in the vehicle, then this policy is recommended as it provides coverage for such goods.
- Open Policy: This transportation insurance policy provides coverage for multiple transits that may occur within a given period, which is generally for one year. So, if a business transports its goods very frequently, then they can purchase this policy and can assure that they will get coverage for more than one trip without purchasing a different transit insurance policy for each trip.
- Goods in Transit through Third-Party Carrier Cover: If your goods are being transported through a third-party vessel or carrier, then that carrier may not take risk of damage to the goods in it. You can, therefore, purchase this insurance plan to provide cover against the damage when the goods are transported through a third-party carrier.
- Goods in transit Through Own Carrier Cover: If you are using your vehicle for transporting your goods, then this insurance will cover the goods against damages.
- Cover for Multiple Vehicles: If you are using multiple vessels for transporting your goods, then you should take an insurance plan of this kind as it will cover the goods that are transported through more than one vehicle. Multiple vehicles are covered under a single plan in this policy.
Benefits of Transit Insurance
Following are the benefits of buying a transit insurance policy-
- Transit insurance policies offer global standard coverage. It means that they cover clauses that are internationally recognized.
- There are multiple coverage options from top insurance providers.
- The policy can be issued immediately online.
- Just by providing limited information, you can get transit insurance cover.
- One of the simplest ways of providing insurance coverage to your goods in transit.
- This insurance policy offers coverage between all risks of damage or loss to goods/ or death of the livestock and the majority of selected perils that you can select according to your business line.
Who can Buy Transit Insurance Policy?
Transit/transportation policies can be issued to the following parties-
- Custom House Agents
Transit Insurance- FAQ
Q. What documents would be needed when settling a claim?
For claim processing, you have to submit the following documents:
- Survey report
- Original invoice of goods in transit
- Landing bill
- Duly filled and signed claim form
- Details of shipping
- The correspondence is done through carriers and copies (of carrier)
- Any other document as mentioned by your insurance provider
Q. Does transit insurance cover partial losses?
The insurance company offers coverage for partially damaged goods and covers the financial losses that you encounter due to this loss.
Q. What does deductible mean when we talk about transit insurance?
A deductible is that level of the claim which is not paid by the insurance provider. The insurance provider pays only when the claim amount exceeds the deductible limit and if the deductible limit is paid by the insured, then the insurance provider pays the rest.