In the world of marine insurance, the two most confusing terms are inland transit insurance and Marine Cargo Insurance. It seems that both are quite similar to each other with many of their provisions overlapping each other. Both provide protection to goods in transit against any damage from man-made or natural disasters, mishandling or damage in loading or unloading from the source to the point of destination.
But many significant points are often missed while defining the clear line of difference between the two. While the basic protection cover is directed to the goods which are being transported, let us compare the factors that set these two significant policies apart from each other.
| Factors of difference | Inland Transit Insurance | Marine Cargo Insurance |
| Definition of inland transit and cargo insurance : | The inland transit insurance policy provides cover to the insured’s business goods or personal belongings while being transported by land. | Marine Cargo policy covers the cost of damage to goods that are imported or exported to/from the nation as well within the national boundaries through any means of transport. |
| Means of transportation | It covers only those goods that are being transported by land transport like through goods train or trucks etc. Sea and aerial modes of transportation are excluded from this cover. | This policy applies to goods being transported by any means of transport like air, sea, road or rail. Some insurers may also include inland transit policies in this insurance cover. |
| Geographical location | This policy mostly provides cover for goods being transported domestically. | Marine cargo policy also provides cover for the international transportation of goods. |
| Calculation of premium | The premium is generally calculated on the types of goods being carried. It is mostly included in the price of the cover. | The premium in Marine cargo policy is calculated on the basis of the annual sales or turnover of the insured business. It is specified and has to be paid over and above the price of cover. |
| Types of risks covered | Most insurers offer this policy with the advantage of covering against all risks. The policy can, however, be taken according to one’s requirements. There is a basic and an extended risk cover available if one does not opt for all risks covered against damage to goods. | This policy covers the risk of theft, piracy and damage to goods while loading or unloading. However, there are certain risks like strikes, violence etc. against which an extra cover needs to be availed by the insured under special clauses of the marine insurance policy. |
| Types of covers available | Overnight vehicles’ cover: This is important for those businesses that require the goods to be stored somewhere at night mostly in the vehicle. Some insurers provide this protection in the basic policy while some give it to you at an extra premium. Comprehensive Policy for multiple vehicles: Some insurers will insure multiple vehicles within a single policy. It is beneficial to avail of this cover if you use multiple vehicles to transport your merchandise. Goods in transit cover for own vehicles: It is to protect the goods from theft or damage while being transferred in any vehicle owned or operated by the insured. Goods in transit (carriers) cover: If a third party or carrier is employed to carry the goods, he may not take responsibility for its damage. In many cases, carriers are unaware of what they are carrying. Such liability can be covered through this policy. | Open cover: It involves the import and export of goods during the 12 months or specified period of the policy. Duty insurance policy: It covers loss to goods while being transported from the port to the importer’s warehouse. Seller’s contingency policy: In some cases, a buyer may be responsible for paying for any damage to goods due to the credit provided to him initially. But, if the buyer refuses to take responsibility for the goods damaged in transit in such cases, the seller can be saved from the financial loss only by this policy. Specific voyage policy: This policy provides coverage for only some specific voyages asked for by the insured. |
| Who can avail of this policy? | This policy is appropriated for small-scale or medium-sized businesses which do not require to import and export their goods internationally. Even, farmers can avail this policy to protect against damage to goods in their own vehicles. | This is generally availed by large-scale businesses including multinational companies to secure their raw materials as well as finished goods. |
So, keep in mind the above factors while you make a decision to avail any of these policies to protect the goods in transit.
