What is Marine Insurance and its types?

by Rosie Esplana

August 20, 2021

If it comes to risk management, you know that even the smallest oversight can turn into a significant threat. These hazards can harm your cargo at any time and at any stage of its journey from point of origin to point of destination. As a result, your cargo deserves nothing less than the best insurance solution on the market. An insurance policy that covers most types of cargo from door to door, making it easier to not only buy it, but also process it.

Hardly any industry can afford to be unprotected at sea. MGS Insurance protects your business from potential liabilities by providing a variety of insurance policies that are tailored to your maritime needs. MGS Insurance is the name you can trust when the unexpected happens.

Our Marine Insurance protects the assured against losses incurred while on a sea adventure, up to the contract limits. A maritime adventure is a voyage or a period of time during which property is exposed to maritime hazards. Designed to compensate for cargo loss or damage, in the event of a theft, natural disaster, or accident.

Another great feature of marine insurance is that transporters can select coverage options that are specific to their trade. Because coverage requirements vary, shipping companies can select a customized insurance plan. There are various policies available to provide coverage based on the size of the cargo ship and the routes taken.

Many advantages come from a single solution

Tranquillity

During the normal course of transit, the cargo may be exposed to a variety of risks. We can provide comprehensive coverage to our world-class suite of supply chain services in the event of theft, natural disasters, or accidents. Safeguards your cargo against a wide range of losses and damages, giving you peace of mind.

Simplicity

With MGS Insurance, which is fully integrated with our online booking portal, you can ensure that your cargo is covered throughout the entire supply chain with just a few clicks. It’s fast, simple, and efficient!

Flexibility

You have the option of selecting between two types of contracting. We make purchasing marine cargo insurance easier for you, whether you want to buy insurance per shipment or agree to have insurance included with every shipment up front.

From beginning to end

And if you do business with us, you can be confident that your shipment is fully insured from beginning to end, door to door. Whatever the mode of transportation or the carrier.

A diverse range of material

When it comes to your company, we understand how important each and every cargo is. A wide range of commodities, including many reefer products, are covered by marine insurance.

There are three major lines of Marine Insurance:

1. Marine Cargo Insurance

This includes goods, property, and/or merchandise in transit by land, sea, or air. The following are the standard coverages provided by the Marine Cargo insurance policy:

Damage or loss to insured goods, tends to result in either total loss (actual or constructive to the insured’s property) or partial damage (known as particular average)
Expenses incurred to prevent or reduce loss (sue and labor)
Hop – by – hop charges for goods discharged prematurely due to an insured peril
The sacrifice of one person’s goods in order to save a venture; the sacrifice will be made up for by those whose goods are saved.

The Marine Cargo Insurance Policy could be expanded to include the following:

Marine Policy Openness
Inland Marine Coverage and Truck Risks
Project cargo coverage, including consequential loss
Container Van Insurance Coverage tailored to specific commodities (Commodity Clauses, Frozen Meat, Frozen Food, Coal, Oil, Rubber, etc.)

2. Machinery and the Hull

Hull and Machinery Insurance policy protects ships or vessels, their hulls, machinery, and equipment, as well as liability resulting from collisions with other vessels. Its standard coverage includes:
Mechanical loss or damage to a ship’s hull, machinery, or equipment that may result in total loss, actual or constructive, to the insured’s property, or partial damage, is referred to as a particular average.
Expenses incurred to prevent or reduce loss (sue and labor, salvage charges)
Average contributions in general
Liability for collisions with other vessels

This line’s coverage could be expanded in the following ways:

Armed conflict and hitting risks, as well as various acts of civil unrest
Additional perils clauses that extend coverage for a vessel’s engines and machinery
Even in the event of a potential claim, the costs for sighting a ship’s bottom

The following items are covered by Hull and Machinery Insurance:

Builder’s Risks – this insurance covers the loss or damage to a vessel while it is being built, including materials that are not yet on board the ship at the time of loss.
Mortgagee Interest – this shields the innocent mortgagee who suffers financial loss as a result of a mortgagee’s act or omission that prevents him from claiming under normal marine, war and strikes, protection and indemnity insurers.
Port Risks Coverage – it provides coverage for vessels that are confined to a port or have limited access to the sea.
Yacht Insurance
Marina or Yacht Club Insurance
Limited Coverage (named peril basis)
Total Loss Only Coverage

3. Ship Owner Liabilities (Security and Reimbursement)

Protects the ship owner or manager from any legal liabilities incurred while operating a ship. This insurance policy protects the ship owner against certain types of third-party liability (e.g. liability for damage to wharves, piers etc.). It also includes contractual obligations for goods carriage, crew employment, and so on.

Significance of Marine Insurance

Shipping industry is one of the safest modes of transportation for goods; notwithstanding, there are certain risks that can cause damage or even total loss of cargo during transfer; thus, it is recommended to contract or enforce transfer insurance for all goods.

The purpose of marine insurance is to compensate the insured party for the damages that goods may sustain as a result of the risks associated with maritime navigation.

All shipping lines are required by law to provide maritime insurance, but these typically provide limited coverage, which is why it is recommended to purchase additional marine insurance coverage to ensure more comprehensive coverage.

You may go to this page to get a free quotation and check how much is marine insurance.

“No one can surely predict the future. But we can protect it”