Marine Insurance
What is Marine Insurance?
Marine insurance is a essential policy that provides coverage for goods, ships, cargo, and any transport
or property by which goods are acquired, transferred, or held between the points of origin and the final
destination. Whether you are transporting goods via sea, air, road, or rail, marine insurance protects
your trade from financial losses caused by accidents, natural disasters, theft, or damage during
transit.
In the world of global trade, marine insurance acts as a vital financial safety net for exporters,
importers, and shipping companies. It ensures that your business operations remain uninterrupted even if
a shipment is lost or damaged. From individual consignments to annual open policies, marine insurance
provides the security needed to navigate the complexities of international logistics with confidence and
peace of mind.
Types of Marine Insurance
1. Cargo Insurance
Provides protection for the goods being transported. It covers financial losses if the cargo is damaged or lost due to accidents, sinking of the ship, or theft during transit by sea, air, or land, ensuring that your trading capital remains secure throughout the journey.
2. Hull Insurance
Covers the physical vessel or ship itself against damages. This includes protection for the ship's structure, machinery, and equipment from perils of the sea, collisions, or fire, making it indispensable for ship owners and operators managing expensive maritime assets.
3. Freight Insurance
Protects the shipping company's income. In case the cargo is lost and the freight charges are not paid by the client, this insurance compensates the carrier for the loss of earnings, ensuring financial stability for logistics and transport businesses.
4. Marine Liability Insurance
Covers legal liabilities arising from damage caused to third-party property or environment by the ship. This includes protection against pollution claims, collisions, and injuries to crew or passengers, meeting mandatory international maritime legal requirements.
Key Features of Our Marine Insurance
Door-to-Door Cover
Complete protection from the warehouse of origin to the final destination.
Global Transit Support
Protection for international shipments across all major global trade routes.
Customs Duty Cover
Reimbursement for customs duties paid on goods that are lost or damaged.
Theft & Pilferage Cover
Security against partial loss or theft of goods during handling and transit.
ICC (A) Clause Cover
Widest possible coverage including all-risks for your valuable cargo.
War & Strike Risk
Protection against losses due to war, strikes, riots, and civil commotions.
Single Transit vs Marine Open Policy
Compare specific shipment protection versus annual comprehensive trade coverage benefits.
| Feature | Single Transit Policy | Marine Open Policy |
|---|---|---|
| Coverage Duration | Single Journey | Annual (12 Months) |
| Best For | One-off shipments | Frequent traders/Exporters |
| Automatic Cover | No | Yes (All shipments) |
| Premium Payment | Per shipment | Adjustable / Bulk deposit |
| Documentation | Required for every trip | Periodic declarations |
| Renewal | Not applicable | Annual Renewal |
| Customization | High | High |
| Cost Efficiency | Standard | Highly Economical |
| Admin Work | Higher | Minimal |
Marine Insurance Coverage
Understand the perils covered and excluded under maritime and transit insurance.
What Marine Insurance Covers
Essential protections for your trade and logistics
- Sinking or Stranding of Vessel
- Fire or Explosion Damage
- Collision or Overturning
- Jettison (Throwing cargo to save ship)
- General Average Sacrifice
- Washing Overboard (Deck cargo)
What Marine Insurance Does NOT Cover
Common exclusions in marine cargo and hull policies
- Improper Packing of goods
- Inherent Vice (Natural decay)
- Intentional Damage or Misconduct
- Delay in delivery or Market loss
- Ordinary Leakage or Wear & Tear
- Insolvency of ship owners
Marine Insurance Add-Ons
Enhance your cargo protection with specialized maritime add-on covers.
FOB / Seller's Interest Cover
Protects exporters when the buyer fails to take up documents or pay, and the risk hasn't transferred to the buyer as per the Incoterms.
Strikes, Riots & Civil Commotion
Provides additional protection for losses or damages to cargo caused by workers on strike, rioters, or persons participating in labor disturbances.
Duty Insurance
Covers the custom duty component of the cargo value, ensuring that you recover the duty paid if the goods are damaged or lost before reaching the destination.
Storage in Transit
Extends coverage to include temporary storage of goods in warehouses during the normal course of transit, exceeding the standard policy duration.
Machinery Breakdown Cover
Specialized add-on for hull insurance covering mechanical failures and machinery damage not resulting from an external accident.
Factors That Influence Marine Insurance Premium
Cargo and voyage details decide the premium for your marine protection policy. It is a key factor in global trade logistics.
1. Type of Cargo
Fragile, perishable, or hazardous goods attract higher premiums due to the increased risk of damage or loss
2. Voyage Route
Shipments passing through high-risk zones, pirate-prone areas, or storm-heavy routes have higher insurance costs
3. Mode of Transport
Air freight is generally considered safer and faster, leading to different premium rates compared to sea or road transit
4. Vessel Age & Condition
Older ships may be subject to additional premiums or 'Over-age vessel' surcharges due to higher technical failure risks
5. Sum Insured & Clauses
The total value of goods and the level of cover chosen (ICC-A vs ICC-C) directly impact the final premium amount
Tips to Reduce Your Marine Insurance Premium
Smart ways to lower your maritime insurance costs through better risk management and packing.
1. Standardized Packing
Use high-quality, export-grade packaging to reduce the risk of damage, which leads to fewer claims and lower future premiums
2. Choose Marine Open Policies
For regular traders, an annual open policy is significantly more cost-effective than buying individual certificates for every trip
3. Risk Assessment of Routes
Selecting safer shipping routes and avoiding politically unstable regions can help in negotiating better insurance rates
4. Implement Loss Prevention
Using GPS tracking, shock indicators, and temperature sensors for cargo demonstrates low-risk profile to the insurer
5. Professional Carriers
Using reputed shipping lines with modern, certified fleets reduces technical risks and lowers insurance surcharges
Documents Required for Marine Insurance
Know the basic documents needed to buy and process your cargo and marine insurance online.
Shipping Documents
- Bill of Lading (B/L) or Airway Bill (AWB)
- Mates Receipt / Consignment Note
- Delivery Order
Commercial Docs
- Commercial Invoice
- Detailed Packing List
- Letters of Credit (LC)
Business Proof
- Import Export Code (IEC)
- GST Registration Certificate
- Company PAN Card
Cargo Details
- Description of Goods
- Weight and Dimensions
- Special Handling Instructions
Vessel Information
- Vessel Name and Flag
- IMO Number
- Vessel Classification Certificate
Other Optional Documents
- Certificate of Origin
- Inspection or Survey Report
- Customs Declaration Copy
Marine Insurance Claim Process – Step by Step
Step-by-step guide for filing a marine cargo claim during transit incidents smoothly.
Immediate Notification
Inform DigiAssure or the insurer immediately upon noticing any damage or shortage in the consignment.
Notice of Loss to Carrier
Issue a formal 'Notice of Claim' to the shipping carrier to hold them legally responsible for the damage.
Independent Survey
An independent surveyor is appointed to assess the extent and cause of the loss at the port or warehouse.
Minimize Loss
Take necessary steps to protect the remaining cargo from further damage or theft during the inspection period.
Document Submission
Submit all original shipping documents, invoices, and the survey report to the insurance company.
Claim Evaluation
The insurer evaluates the claim based on policy clauses (ICC-A/B/C) and the surveyor's findings.
Liability Verification
Verification of Incoterms (CIF/FOB) to determine who holds the insurable interest at the time of loss.
Final Settlement
Once approved, the claim amount is settled directly to your account or to the beneficiary as per LC.
Benefits of Marine Insurance
Experience secure global trade with our comprehensive maritime protection benefits.
Financial Security
Protects your capital from heavy losses caused by cargo damage or sinking of the vessel during transit.
Legal Compliance
Meets mandatory requirements for international shipping contracts and Letters of Credit (LC).
Theft Protection
Covers losses due to piracy, theft, and pilferage during handling and storage at ports and warehouses.
Natural Perils Cover
Stay protected against damages caused by storms, tsunamis, lightening, and other perils of the sea.
Intermodal Protection
Coverage for shipments involving multiple modes of transport like sea, rail, road, and air in one policy.
Liability Management
Provides cover for legal liabilities and pollution claims, protecting the shipping company's reputation.
Add-On Benefits
Enhance protection with optional covers like War Risk, Strikes & Riots, and Customs Duty Insurance.
Global Network
Access to international surveyors and loss adjusters to handle claims anywhere in the world.
Peace of Mind
Focus on your core business of trading while we handle the risks of global logistics and transportation.
Better Credit terms
A comprehensive marine insurance record helps in securing better financing and credit terms from banks.
Frequently Asked Questions
Quick answers to common queries about marine cargo and hull insurance policies.
What is a Marine Open Policy?
An Open Policy is an annual contract that provides automatic coverage for all shipments made by the insured within the policy period. It is ideal for frequent traders as it removes the need to buy individual certificates for every trip.
What is 'Inherent Vice' in marine insurance?
Inherent Vice refers to the natural tendency of certain goods to decay or deteriorate over time (like fruit rotting or metal rusting). This is a standard exclusion in marine insurance as it's not an accidental peril.
Does marine insurance cover goods by air?
Yes, marine insurance is a broad term that includes 'Transit Insurance'. It covers goods transported by sea, air, rail, road, and even courier services, from the point of origin to the destination.
What are ICC(A), ICC(B), and ICC(C) clauses?
These are Institute Cargo Clauses that define the level of cover. ICC(A) is the widest 'All-Risks' cover, while ICC(B) and ICC(C) provide progressively more restricted coverage for specific named perils.
What is General Average in maritime law?
General Average is a principle where all stakeholders in a sea venture (ship owner and cargo owners) proportionally share the losses resulting from a voluntary sacrifice made to save the ship and remaining cargo from an emergency.
Who should buy marine insurance - Buyer or Seller?
This depends on the 'Incoterms' agreed upon in the sales contract. For example, in a CIF (Cost, Insurance, Freight) contract, the seller buys the insurance. in FOB (Free on Board), the buyer is responsible for insurance once the goods are on the ship.
How is the sum insured calculated in marine?
The sum insured is usually the 'CIF + 10%' value. This includes the Cost of goods, Insurance premium, Freight charges, and an additional 10% to cover incidental expenses and anticipated profits.
How long does it take to settle a marine claim?
Simple cargo claims are usually settled within 15-30 days after submission of the final survey report and documents. Complex hull or general average claims may take longer due to legal and technical verification.