What is the Scope of Marine Insurance?

Scope of Marine Insurance

A comprehensive marine insurance policy ensures the security of vessel operatives. Furthermore, it also ensures that there is a minimum liability in case of any loss or damage to the cargo in transit. So what really is the Scope of Marine Insurance?

Usually, people assume that marine insurance covers only sea transit. However, in reality, a marine transit insurance policy covers transit by air, water, courier, registered post, etc.; or a combination of any of them. Further, a marine insurance policy covers the transportation of goods and this can be divided into the following categories-

Inland Transport
Import
Export

Not only, it is essential to buy good marine insurance for a vessel; it also makes it useful to go for the apt insurance cover which can cover you for different types of risks. Usually, marine transportation entails risks that may not always be under the control of a vessel operator. For instance, you are transporting your goods via sea; you can safeguard yourself against various risks which may arise during transit.

A ship used for transporting goods usually travels a long distance, and therefore the degree of risks involved is also high. When you buy a marine insurance policy, it gives protection and security to your vessel operatives if the cargo gets damaged in transit. Therefore, it is necessary to have marine insurance before transporting your goods.

Coverage for various industries under Marine Insurance

As per the requirement, it is possible to extend the marine insurance policy in order to cover a wide range of risks in the following industries:-

Electronics Industry
Fine Arts
Healthcare Industry
Pharmaceutical Industry
Consumer Goods Industry

Note, that industries can buy a marine insurance policy for other purposes besides those mentioned above. Then, there are various kinds of marine insurance policies like cargo insurance, liability insurance, hull insurance, etc.; which you can choose as per your requirement. Once you purchase a marine insurance policy, it is feasible to customize it to suit your different business requirements.

Case:

For the last five years, K.N Apparel is exporting goods to buyers situated in different parts of the world. The company prefers to send all its goods via sea route. Last year, it sent a huge consignment to the party in Sri Lanka. Unfortunately, when the consignment was in transit, it started raining heavily, and it damaged a substantial part of the goods. When the consignment reached the destination, the buyer refused to take the delivery of goods as they got damaged by water.

The million-dollar loss made K.N Apparel think about what they could have done to avoid such a loss.

Solution

The situation would have been different if K.N Apparel had purchased a marine insurance policy. The policy would have saved them from incurring heavy losses, and the insurer would have come forward to cover losses or damages which happened due to rainwater. As soon as the loss happened, K.N Apparel would have to inform the insurer which would have settled the claim after carefully reviewing all the policy documents.

Well, natural calamities like rain, earthquake, etc.; are beyond your control, but you can take some steps to minimize losses.

Understand the scope of a marine insurance policy and buy a suitable one to cover the losses and damages arising due to perils of the sea. SeccureNow helps customers to buy the best possible policy and understand its scope completely to minimize financial losses.

About The Author

Simran

MBA Insurance and Risk

With extensive experience in the insurance industry, Simran is a seasoned writer specializing in articles on marine insurance for SecureNow. Drawing from 5 years of expertise in the field, she possesses a comprehensive understanding of the complexities and nuances of marine insurance policies. Her articles offer valuable insights into various aspects of marine insurance, including cargo protection, hull insurance, and liability coverage for marine-related risks. Renowned for their insightful analysis and informative content, Simran is committed to providing readers with actionable information that helps them navigate the intricacies of marine insurance with confidence.