Marine Insurance and Its Importance
Marine insurance is an insurance policy that offers coverage for damage or loss to goods, vessels, etc. in transit. In general terms, it is insurance provided to the cargo, ships, marinas, equipment etc. Marine insurance and its benefits cannot be ignored if your business is involved in shipping or related activities where there is frequent transit of goods from one destination to another. Let us look at some of the reasons why this insurance is important:
- Accidents can sometimes be inevitable
- Increase in theft
- Huge losses can be incurred
- Increase in natural disasters
- Faster claims settlement compared to a liability claim
What is Marine Insurance Blanket Policy?
Marine insurance blanket policy, also sometimes referred to as marine open cover, is one of the most common and comprehensive types of insurance available to the insured. This policy is taken to cover damages or losses within a specific period. A marine insurance blanket can cover the following three dimensions under one single policy:
- Different assets at a single location
- Same asset at different locations
- Different assets at different locations
This comprehensive policy provides maximum coverage for a premium. The policy is taken for a certain pre-decided premium amount. The complete premium amount is paid at the beginning of the policy and is later re-adjusted at the end of the policy tenure. This adjustment is based on the actual amount at risk.
If the premium amount is more than the actual risk, the difference is returned to the insured at the end of the tenure. Similarly, if the premium amount is less than the actual risk, the insured will have to pay an extra premium to cover the cost.
Features of Marine Insurance Blanket Policy
Here are some of the features of a marine insurance blanket policy:
- This policy is designed specially to help the companies that have high business transactions or volume related to import and export.
- With a marine insurance blanket policy, the companies are not required to undergo different insurance agreements every time they have a transaction. A single policy enables them to do multiple transits within a specific time frame.
- Since it is a blanket cover, it provides coverage under the goods insured, packing conditions, voyages, risks covered, etc. based on the conditions agreed upon.
- Even though the blanket cover has a validity of 12 months, it can be cancelled by the insured by submitting a prior written notice to the insurer.
Conclusion
Marine insurance is essential for shipping corporations, transporters and similar parties as it helps to reduce the aspect of financial loss in case of loss of cargo. With a marine insurance blanket policy, you can enjoy comprehensive coverage for continuous business. The insured thus do not have to buy a new policy every time a shipment is sent.
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