With the world now being a global economy, it is common to get goods shipped across continents. Maritime transportation is currently the best choice for hauling bulky and odd-shaped cargo. Compared to other transportation alternatives, it is inexpensive and eco-friendly. While marine accidents are not so common, it is still essential to get insurance in case anything should happen to your cargo and vessel. Marine insurance covers any loss affecting the ship, cargo or passengers along with third-party liabilities arising from sea transport.
The charterers liability is the renowned form of marine insurance. This is designed to cover the care, custody and control a party chartering a vessel will assume for it during a cargo’s transport. It covers the cargo’s damage, pollution of the waters by the vessel, damage to the hull and indemnification of a ship’s owner in case of contract breaches by the charterer. The clauses are among the crucial elements you should consider in your marine insurance policy. Here are the most important clauses.
This denotes the value of the vessel being insured. The policy’s value will be written on your insurance on the space for the valuation clause. In case there is a loss, the insurer will only compensate the insured up to the amount specified in the clause. You can alternatively leave the amount blank and have it added after a loss occurs.
‘’At and From’’ Clause
This includes the time when a risk will commence. The risk coverage will, in most cases start once your ship leaves a port. If for instance your insurance states ‘’at and from Madras’’, this means that the risk will be covered when your vessel is at Madras port and when it leaves the port. The ‘’at and from’’ clause is generally used in the hull and freight insurance.
Warehouse To Warehouse Clause
This covers the risks from the shipper’s warehouse to that in the destination. If your cargo is being shipped from the hinterland down to the port, you will need a policy to cover the risks at sea and land. These will include the shipping of the cargo from one warehouse to another. It indemnifies shippers from issues that might affect the cargo during transportation to and from the port.
This covers any loss attributed to the negligence of a crew member when loading and offloading the cargo. The clause was introduced in marine insurance after an infamous case in 1857 around a ship called Inchmaree. Here the vessel was damaged owing to the crew’s negligence. The insurer could not pay for the damages since these did not fall under the ‘’perils at sea’’ cause. The Inchmaree clause was added in the insurance sector to cover ship owners against damage to their vessels.
Chartering a ship is one of the surefire ways of making money with the increase in cross-border trade. Signing up for marine insurance will not, however, automatically cover your ship from the elements that will affect the vessel and cargo at sea. Paying attention to and understanding the above clauses is crucial to guarantee you will have someone cover any damages should anything happen to your vessels and cargo.