What are the types of marine insurance?

Marine Insurance

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There are several types of marine insurance policies available to cover the various risks associated with marine transportation. These policies mainly include Hull Insurance, Machinery Insurance, Cargo Insurance, Freight Insurance, P&I Insurance, War Risk Insurance, Builders’ Risk Insurance, Offshore Energy Insurance:

Hull and Machinery (H&M) Insurance are types of marine policy that together cover damage to the vessel and its machinery, including collisions, fire, and sinking. Cargo Insurance provide coverage for loss or damage to cargo during transportation by sea, air, or land. In case of loss of income in the event that the shipment is lost, damaged, or delayed, a Freight Insurance comes into play offering much needed financial protection. Protection and Indemnity (P&I) Insurance offers liability coverage for the shipowner or operator, including third-party claims for personal injury, pollution, and damage to other vessels. Builders’ Risk Insurance is meant to provide coverage for loss or damage during the construction or repair of a vessel. Offshore Energy Insurance is especially designed to provides coverage for offshore installations, including oil rigs and wind farms. War Risk Insurance covers for damage or loss caused by acts of war, piracy, or terrorism.

The specific terms and conditions of these types of marine insurance policy can vary widely depending on the insurer and the specific risks being covered. It is important to carefully review available types of marine policy and to ensure that the coverage meets the needs of the insured party.

Different Types of Marine Insurance Policies

Cargo insurance

Cargo insurance is a risk management tool that generally protects shipments from loss, damage, or theft while in transit. This coverage is beyond basic claims insurance that may be provided, and it will reimburse for the designated value of the goods if a covered event occurs while the freight is in transit.

Hull insurance

Hull refers to the body of a vessel. This insurance covers boats, just like comprehensive automobile insurance covers vehicles. It covers all kinds of vessels going into the ocean, like ships, pontoons, yachts, cruises tankers, bulk carriers, dredgers, trawlers, fishing boats and other pleasure boats, jetties and wharfs.

Freight insurance

A Freight insurance policy offers additional protection to your freight against potential losses caused to the shipment during the transit. There are different types of freight insurance policies including marine insurance, shipping insurance, cargo insurance, transport insurance, and transit insurance. All these policies cover merchandise and goods against loss or damage during transit from one location to another.

Liability insurance

Liability insurance is a type of marine insurance where compensation is sought to be provided to any liability occurring on account of a ship colliding or crashing and on account of any other induced attacks.

There are also various types of policies under marine insurance which include the following –

Time policy

This policy provides coverage up to a specified time, for instance, one year.
Voyage policy

This policy provides coverage for a specific voyage. As soon as the voyage or trip comes to an end, the policy expires
Mixed policy

This policy combines time policy and voyage policy and covers voyages taken between specific destinations during a specific time period.
Port risk policy

This policy covers the loss suffered by the ship when anchored at a port
Valued policy

Under this policy, transportation for the value of the cargo mentioned beforehand specifies the coverage level of the plan. The value mentioned in the policy pays the claim in case of loss of cargo.
Unvalued policy

When the value of the cargo does not determine beforehand, called an unvalued policy. Under this policy, the loss suffered would estimate when the loss happens.
Floating policy

A floating marine insurance policy is for businesses that transport goods frequently. Under this policy, the policyholder buys the policy for a lump-sum value. Nothing else is specified. While transporting the goods, makes a declaration for the value of goods, deducted from the lump sum amount selected under the policy. The policy covers multiple voyages up to the lump sum limit.
Block policy

Block policy in marine insurance covers transportation of goods both by land as well as sea
Composite policy

Multiple underwriters underwrite composite policies in marine insurance and each underwriter has a fixed liability
Fleet policy

The vessel owner takes a fleet policy in marine insurance to cover the fleet of vessels he owns.

These are the basic types of marine insurance policies. Businesses can select the most suitable policy for their requirements to get the best coverage at the lowest rate of premiums.