Marine Insurance

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Why should you buy a marine insurance policy? The answer is— because you are a shipper. If the answer is not enough to convince you, then keep reading.
Marine insurance covers losses or damages caused to ships, cargo, and terminal. Simply, it is an insurance cover while in transit.
A comprehensive marine insurance curtails shippers’ exposure to financial losses or damages. Unfortunately, many shippers import or export their goods without marine insurance. However, they have suffered a loss for taking such kind of risk.
Still, if you are looking for reasons to buy marine insurance, then here it goes:
1. Rise in cargo theft – Cargo theft continues to hamper global supply chains, resulting in loss of billions of dollars in direct losses and downstream costs. Cargo theft, especially, through fictitious pickups and a fake identity, is increasing at an alarming rate. What if your cargo also becomes the target of thieves? It is better to buy marine insurance now than repent later when the loss already strikes.
2. Increase cases related to containers lost at sea every year – With the rising trend of carrying huge stacks of shipping containers, an upsurge has been recorded in cargo containers overboard. It means, more containers are lost at sea every year. According to the surveys conducted by the World Shipping Council, approximately 733 containers lost at sea during 2011- 2013, which was more than the double the number of containers lost between 2008-2010. Considering this alarming rise, it is useful to go with a marine insurance
3. Disasters can strike anywhere – Incidents, like a storm, shipwrecks, pirate attack, etc.; strike anywhere and cause multi-billion economic loss. For instance, the number of ships hijacked by pirates almost doubled in 2014 as compared to the previous years.
See: Exclusions in Marine Insurance Policy
4. Cargo damages– Like theft, damage to cargo is also common. Even after taking all safety measures, cargo damages happen due to reasons like, faulty export packaging, inadequate ventilation, wrong choice of container, poor condition of the container, overloading, etc. Though, many reasons could lead to cargo damage, you would have to suffer financially if you have no marine insurance.
5. Contractual requirement– Shippers’ sale contract may obligate you to buy a marine insurance to safeguard interests of buyers. Failure to buy a marine insurance when a shipper is contractually obligated to do so, will not only make the shipper vulnerable to financial loss if there is a loss or damage to goods, but non-compliance with the terms and conditions of the contract mean that you will lose the trust of your buyers.
6 .Carriers can’t be held responsible for loss– Carriers, by law, can’t be held responsible for various common causes of losses like natural disasters, low average, etc. Even in those situations, where carriers are responsible, liability will be restricted. Therefore, shippers should never depend on the carrier which is shipping their goods or services in case of any loss or damage that may occur during the transit and buy a marine insurance policy.

Source: International Chamber of Commerce International Maritime Bureau
Such events financially affect those companies who have no marine insurance policies.

Read more: Why should you buy Marine Cargo Insurance Policy While Trading Across nations?
7. Customisation option is available– Though, you can rely on the buyer’s or seller’s insurance, buying your marine insurance is a good idea. In this way, you can customise your cover as per your needs. On top of that, if a claim arises which is handling by a foreign insurance company, perhaps in a different language, it can kill both your time and efforts. Shippers who buy marine insurance themselves are usually in a much better place than shippers who rely on third-parties for their marine insurance requirements.
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