Yes, buying specific transit cargo insurance is worth it as it is a protection tool to cope up with damages to cargo during transit. If something goes wrong during a voyage, you can restore your financial stability with the right cargo insurance cover.
Specific transit cargo is the best-fit insurance cover for those who send out consignment and cargo occasionally. Businesses with an irregular need for cargo transportation services can mitigate their risks with this kind of insurance.
Advantages of buying specific transit cargo insurance:
1. Covers all modes of transport in a single voyage:
Generally, transportation of a consignment in a single voyage may involve more than one mode of transport. Specific transit insurance cover offers coverage of road, rail, sea, and air movement. It covers damage to cargo, onshore or offshore. Specific transit cargo insurance covers a single transit within India. Transit insurance also covers exporting and importing cargo from another country to India. The policy also pays for loss during air or ocean freight during international shipping.
2. Covers maximum value at risk:
As there is no fixed sum insured so the limit of indemnity is determined on the agreed value basis. . Specific transit insurance tries to cover maximum value at risk taking into account the invoice value, freight cost, and incidental expenses. Determining the sum insured by using such factors ensures the maximum value of the limit of indemnity required for risk mitigation.
3. All-risk protection for your cargo:
Cargo insurance offers all-risk protection coverage. Be it non-delivery, theft, earthquake, fire, heavy weather, or sinking, your specific transit covers damage to cargo against such perils. There are exclusions such as damage or loss of cargo due to war, strike, riot, civil commotion, and terrorism. However, cover these exclusions by paying the extra premium amount. Avail total protection against damages to goods-in-transit with specific transit cargo insurance.
4. Easy policy issuance:
It is easy and convenient to issue specific transit cargo policies since the information needed is less. Immediate coverage is been provided under single transit insurance. A soft copy of the policy is issued immediately to serve as evidence of transit insurance. One can buy specific transit insurance without much hassle. The policy ceases once the goods are delivered to their destination.
5. Coverage for all types of cargo:
Specific transit insurance provides coverage for all types of cargo against a wide range of perils, for example, the collision of vessels. Be it perishable goods, raw material, fragile goods, high-risk nature goods, or durable goods, you can cover any type of cargo. The premium amount is affected due to the nature of the cargo. High-risk cargo or perishable cargo assumes a high-cost premium.
Customize policy as per the nature of the cargo, sending limits for each transaction, per location limits required, transport mode, location or any other specific needs. Depending upon the risk exposures, you can select either full risk coverage or specialized peril coverage.
Specific transit insurance offers coverage for three types of clauses:
- Inland Transit Clause (A) – All-risk coverage
- In Inland Transit Clause (B) – Limited Coverage, Fire, and accidental loss coverage
- Inland Transit Clause (C) – Limited Coverage, Fire
Read in detail about– Institutional Cargo Clauses in Marine Cargo Insurance
The above clauses are provided to the client on the basis of the risk profile of cargo transported. There is a low-cost premium for single transit cargo insurance since the single trip is secured against various perils. It offers a maximum sum insured coverage at a low-cost premium. It can cover both domestic transit and import and export transit.
The benefit of having specific transit cargo
Specific transit cargo insurance is a cost-effective and convenient risk mitigation tool.
This issuance of the policy is done on an occasional basis. You can broaden the specific transit cargo insurance coverage with the inclusion of various add-on covers. These include cover for debris removal, customs duty, and damage or loss of cargo due to war, strike, riot, civil commotion, and terrorism.
It is equally important to read the list of exclusions while buying specific transit cargo insurance. Exclusions include loss due to willful misconduct of the insured. The policy does not cover loss due to inadequate packaging or any other malicious damage caused to the consignment.
If the need for cargo insurance is regular and the movement of goods and cargo is frequent, then one can take the open cover policy which covers all the trips performed in a year.
Otherwise, specific transit cargo insurance, also known as single transit insurance is optimum for occasional trips of cargo.
A business may face severe disruptions on the damage of a consignment. This can happen due to heavy loss but such loss should not spill over to other parts of your business so it is better to ensure all your important consignment.