General Average is nothing but another name given to general loss. It applies when something untoward happens to a ship carrying cargo. Every cargo owner, along with the carrier company, becomes responsible for their and other’s cargo and the vessel when General Average is declared.
Common examples are fire on-board, the vessel getting stranded or grounded because of machinery breakdown, shifting of cargo in bad weather risking the ship’s stability, or any other life-threatening situation caused due to circumstances beyond control. When these extraordinary situations happen, the captain or the shipping company may opt for jettisoning some cargo or do some emergency repair entailing damage to some cargo for saving the crews and the voyage.
In such cases, the cargo owner not only loses the goods, he also has to share a part of the general loss. The amount may go up to even millions of dollars and only insurance coverage can save from such perils. The Insurance provider gives bonds and arranges contributions for the loss incurred.
This article by ICE Cargo covers what is Marine insurance and helps in buying one
Marine Insurance: Is It Worth It? (A Guide That Will Actually Help)
Over 90% of the world’s trade is transported by ocean freight. This equates to over 10 billion metric tons of cargo moved each year around the globe. For the most part the container shipping industry provides a cost-effective and safe way of transporting goods. In most instances, your cargo will arrive on schedule and in the condition you expect. Shipping, however, is not without associated risks. Read more here!
Marine Insurance can provide a wide range of coverage
Almost 75% of the earth’s surface is full of water and the ocean route happens to be mostly used for export and import by all nations. While the cargo reaches the destination port safely and on time mostly, this shipment route is not free from risks. The vessel voyages through the vast ocean for days covering different parts of the world. And, sometimes the ship has to combat bad weather and high waves.
There are safety regulations and the ships religiously follow them. But things like inclement weather, pirate attacks, collisions, border conflicts, cargo damage are common in marine transport. Because of such high stakes, there is a wide variety of marine transport insurance.
They include hull insurance, machinery insurance, P&I insurance, liability insurance, FD&D insurance, freight insurance, and marine cargo insurance for different needs and one can also have different types of policies. Marine Insurance is a complex subject and one must have a thorough understanding of the coverage needed for shipment to mitigate losses from untoward incidents.
This article by Marine Insight explains Marine insurance coverage in detail and what are all the things you should keep in while buying one.
Different Types of Marine Insurance & Marine Insurance Policies
The subject of Marine Insurance is very wide and encompassing, which is why there is a definite categorization of various types of marine insurance and different types of marine insurance policies. As per the needs, requirements and specifications of the transporter, an appropriate type or types of marine insurance can be narrowed down and selected to be put into operation. Read more here!
How Marine Insurance Work?
Insurance is an integral part of international business these days. These are great to protect the valuable goods of the owners. As the name suggests, marine insurance is associated with sea trade. Other than relating to businesses done through ocean transport, it also covers other transport for movement of goods. Marine insurance covers a lot of things from loss or damage to the vessel and cargo and has a wide area of application. Marine transportation is a complex and risky process and it depends on several factors including circumstances beyond control.
As a result, several risks are associated with marine transportation and this is where marine insurance comes in. When one purchases marine insurance coverage, it transfers the liability to the insurance provider. It covers many perils like loss and damage to the cargo, injuries, pollution, or contamination. The loss is compensated after assessing the fault and covers both cross liability and single liability.
This is mostly obligatory through the export contract and the liability is limited to the provisions of international conventions.
This article by Trade Finance Global explain how Marine insurance works and the types of it.
Marine Insurance – Marine Insurance Explained
Marine insurance is a must for ship owners, shipping corporations, and cargo owners to protect their interests. Here is all you need to know about marine insurance and the various structures. Marine insurance offers coverage for any damage or loss related to ships, cargo, terminals, transports, or transfer. Simply put, a marine insurance policy will cover any loss or damage surrounding the boat or watercraft. Read more here!