The terms, procedures, formalities, and documentation form a critical part while filing a claim for an export/import insurance policy. The following procedure should be followed in the event of a loss:
Intimate the Insurance Company about the Loss
To file the claim under export and import insurance, the first step is to notify either of the following:
- The export and import insurance company or
- Its nearest office or
- Its overseas agent is mentioned in the policy.
The insurance company should be intimated about the loss without delay. It is essential to file the claim within the prescribed time limit.
Surveyor appointment by the Insurance company
The insurance company appoints a surveyor to determine:
- The cause of loss
- The extent of loss
Details to be included in the survey report are:
- If the packing was sufficient?
- Any recommendations, if any, on the improvements?
- How could the claim have been minimized?
- Was there a failure on account of the insured by not taking adequate measures to avoid or minimize loss
- Any failure on account of the insured of not protecting the rights of recovery from carriers/ Port, etc.
- Landing Remarks
It is essential that the insured obtains the landing remarks from the Port Authorities.
Document for the Claim
The insured must submit the following documents while filing the claim:
- An original insurance policy or certificate
- A copy of bills of lading
- Survey report / Missing certificate
- Original invoice and packing list along with shipping specification or weight notes
- Copies of correspondence exchanged with the carriers or bailees
- Claim bill
Case 1 on Filing a Claim under Export/Import Insurance Policy
MM Gaskets Inc. based in India was a client-centric organization, engaged in offering an unmatched range of Steel Gaskets to clients. The entire range of steel gaskets was well tested under the supervision of experts to ensure international standards of quality. In fact, the company got a huge order to export steel gaskets worth rupees 20 lakhs to a company based in Singapore. Delivered the consignment of steel gaskets was to the company after thirteen days via waterways.
However, upon the arrival of the cargo, the importing company rejected the delivery. The cause for the same was rusting of the steel gaskets and not being up to the required standards. As MM Gaskets Inc. had bought an export and import insurance policy, the company immediately approached its insurer for claim settlement. As a result, appointed the surveyor to take the matter under consideration.
The surveyor found out that despite good packaging, the shipment of steel gaskets rusted due to exposure to saltwater during transportation. The reaction caused the steel gaskets to rust during the transit. The insurance company asked MM Gasket Inc. to submit a damage certificate along with proof of dispatch. Also submitted the original invoice and packing list. The insurer reviewed all the documents and approved the claim settlement.
Case 2 on Filing a Claim under Export/Import Insurance Policy
A food processing company, located in Gujarat, well-known locally for its excellent quality of raw materials used. Through word of mouth, the company started getting orders to deliver their food products to distant places. As the company was new, it did not have experience in exporting to out-of-country locations. However, in its effort to expand and progress, the company thought of taking export and import insurance to protect its exported products from any loss.
The company got an order to export its food items to Sri Lanka. However, upon delivery, the importing company rejected the consignment. The food manufacturing company immediately contacted its insurer.
On investigation, the surveyor of the insurance company found that the exported food items were of perishable nature. They required a special type of cooling to withstand longer-duration transportation. However, the company did not know about the cooling requirements for preserving their perishable food item during such transportation and packed the food items as they did locally.
As there was negligence on account of the food manufacturing company, they did not get the benefit of the export and import insurance claim.