Marine insurance policy grants protection against the loss or damage of cargo, ships and terminals between the point of origin and to destination. Individual insurance accounts are important for setting marine insurance rates. The underwriter’s judgment and personal evaluation are very important in setting these rates. There are various factors that influence the risks. Here is the blog post illustrating the principle of rate making in marine cargo insurance policy.
Cargo Insurance
The following factors depend on calculating the premium for marine cargo insurance:-
●Ownership
It may happen that two separate owners’ ships carrying the same type of cargo to the same place will command different rates. Determining the rate involves considering proper packing and profitable accounts.
●Cargo Characteristics
The variety of commodities, their different forms, the way they’re shipped, and their durability all play a role in how much it costs to insure them.
●Hazards and Customs of marine cargo insurance
Consideration of topography and natural forces in the case of ships also applies to cargo transportation. The effect of season or climate at the port of destination may influence the risks. The port is always bustling with different kinds of cargo depending on the season. Different trade customs will have a big impact on the rates charged for shipping. And on some routes, there’s a greater risk that something will go wrong.
●Quality of the Vessel Used as a Carrier in marine cargo insurance
The fitness of the vessel to carry the particular cargo also plays a crucial role in calculating the premium. The premiums are higher in case of ships’ slower speed due to the longer exposure of cargo. Special types of vessels have been designed to carry larger quantities of highly perishable goods during transportation.
●Duration of Voyage and Policy Conditions
Insurers consider the duration goods remain loaded on vessels and protected at docks when calculating premiums.
Conclusion
Understanding the principles and risk factors while calculating the premium of marine cargo insurance can help the policyholder to understand the contract more actively. Know more about the marine insurance policy and other types of general insurance at the SecureNow website. Excellent in providing a quality insurance policy that is beneficial for businesses. Contact us for the best quotations now!
