Most of us have heard the term marine insurance; but what about the goods that are delivered by road; does it also require an insurance? The answer to that would be in the affirmative; as even though the delivery is by land; it doesn’t mean it is not free of risks, and can in fact be of substantial value for some companies or people.
What is it?
Transit insurance policy or inland transit insurance is a simple and convenient mode of covering the risk of business goods or personal belongings of the insured’s while in transit on land. Its premium is based on the value of goods in transit; and the amount of risk the insured is bearing during that period.
This insurance covers the packing and unpacking, loading or offloading, transportation and storage of goods during the entire move. It also covers damage or loss of goods due to mishandling or other forms of damage such as accidents, explosions, impact fires, theft and malicious damage while in transit.
Who should take it?
The policy is beneficial to those who regularly transport goods over large or small distances. For those individual where materials or stock is an essential asset of their business and it is important it is protected during transit; then a transit insurance policy helps insure them against loss, damage or theft when the goods are being transported. So if you are retailer who depends on a third party courier for transporting your goods, or a tradesman transporting expensive tools and materials from one place of work to another, then this policy will help you protect the long term security of your business.
What to look for while taking the policy?
When you are taking the policy it is important to be clear about what the policy includes and that it matches with the risks involved while transporting the goods. If you unaware about what is covered in your policy; then it is better to ask your insurer to update you with the breakdown of the policy, to ensure you have taken the right type of cover. Few typical inclusions of the policy generally include- loss of goods, theft of goods, damages, delays cause, etc – caused during transit of the goods.
Different types of cover
Vehicles overnight cover– some providers also offer a cover where you get an overnight cover as standard and some provide it with an extra payment. If your trade requires storing tools or goods in your vehicle overnight, then you need to check whether this aspect is covered in your policy.
Multiple vehicles with only one policy cover- It is possible at times that the provider will cover multiple vehicles with only one policy and also offer a good rate. If your business has more than one vehicle which requires being insured then this type of cover can prove to be time saving as well as less costly.
Goods in Transit Insurance (own vehicles)– as the name suggests it covers for major transit risks and theft of goods carried in any vehicle owned and/or operated by the insured; but not pertaining to only a specific vehicle. It is a simple and inexpensive cover which mainly suits smaller businesses and farmers with one or more vehicles used for collection and delivery of goods.
Goods in Transit (carriers) Insurance– again as the name suggests this policy provides the carrier with the ability to handle commercial settlements with their customers; due to loss or damage of goods or livestock which was insured by the carrier. There are two types of cover provided here – comprehensive which covers against all the losses or damage to goods caused due to accident, natural causes or humane slaughter and the other one is a cover provided for defined events such as damage caused due to major events like fire, flood, collision, overturning, impact; it can also be extended to things like theft, non-delivery, etc.
Specified Items in Transit Insurance– this is generally used for products which are tools of trade, such as – mechanical and/or electronic equipment, musical instruments, computers or other equipment, etc. The policy is suited to tradesmen, professional people, small businesses, sporting groups, schools and associations, etc. The policy is a simple policy that can be taken annually for major transit risks and also other risks like theft, damages, etc of these specific goods; when they are regularly transported on any registered road vehicle or trailer.
- It is the most simplest and convenient way of covering inland transits or exports to FOB point.
- The policy provides a choice of cover between all risks of loss or damage to goods (or death of livestock) and major nominated perils; which you can select as per your line of business.
Finding the best deal
The best deal is one that offers the right cover at the lowest cost possible. Hence it is always a good idea to check the special features offered by your policy and opting out of cover that is not applicable to your business. For instance if your policy covers fresh food and beverage of goods across India, but you are selling cutlery only in Maharashtra, then the policy is providing a higher level of cover which you do not actually need and should think of getting it altered to save costs. Finally checking with your insurer about the features which are optional and which are included as standard can also help lower costs.