Based on specific requirements of the industry marine policies have been standardized under following categories:
- Cargo Insurance: Exclusively covers the cargo on the ship. It also covers the risk of damage to objects owned by the voyagers of the ship.
- Time Policy: This is marine insurance cover for a limited period.
- Valued Policy: The insurance cover is subject to cover provided for a pre-determined value. In the case of any mishap, your insurance policy will only reimburse subject to the fixed value.
- Hull Insurance: It covers the torso and hull of the vessel. Also covered is a risk of damage to various articles and furniture in the ship. It is insurance against the value of ship loss.
- Liability Insurance (part of Hull Insurance): Insurance compensation, in this case, is calculated based on the total liability of the insured. Suppose there is a ship accident or collision, whatever be the liability on the part of the insured linked to risk of such an accident, is covered by your insurer.
- Mixed Policy: Mix of time and voyage policy.
- Unvalued Policy: Unlike valued policy, in this type of marine insurance policy the exact insurance amount is calculated by inspecting the extent of the damage. The exact damage loss is assessed after the accident.
- Port Risk Policy: This is risk cover when the ship is stationed at the port.
- Floating Policy or Open Policy: Several shipments are covered under a single policy. A fixed sum is determined to cover multiple shipments, and the details of any shipments are only declared afterwards.
- Fleet Policy: Several ships belonging to a single owner are covered under one policy.
- Block Policy: This insurance covers the cargo for every risk of land and water. The policy covers the cargo on Door to Door basis; i.e. from the pickup point of the seller to the drop-off point for the buyer, even if it includes land transport in between or at either end.
- Single Vessel Policy: Only one vessel is covered under this type on the marine insurance policy.
- Named Policy: In this type of marine insurance coverage, ships are covered under its name. The name of the ship is mentioned in the insurance document.
- Blanket Policy: Maximum protection amount is paid at the time of buying the policy. The amount is adjusted after compensation is paid.
- Composite Policy: Under this policy, each owner of the policy is accorded a fixed sum. One insurance policy has multiple owners, and their obligation classified legally.
Case on Marine Policies
Raman Exports Pvt. Ltd. is involved in export of goods to European and Latin American Countries. It’s estimated annual turnover is Rs. 500 cr. and thus based on this figure Raman Exports uses an Annual Turnover Policy for safeguarding his interests. He has to bother about the policy document only once in a year. However the insurer uses his quarterly sales figures for forecasting the cover for the next quarter.
Shivalik Containers & Shipping Ltd. is a firm involved in packing and shipping operations. They provide packing material and services for the exporters along with the shipment. Shivalik Ltd. uses Marine Hull and Liability insurance policies to safeguard against any damages to the ship, loss of cargo or employee injuries.
Parvati Diamond & Jewells Pvt. Ltd. is buying a dozen of diamond cutting machinery from a German manufacturer. The firm’s workshop is based in Surat. Since this is the first time the company will be importing the machinery, the owners have requested for a block policy cover for the shipment, which will cover the goods until it reaches their workshop.