Marine Cargo Insurance

Marine Cargo Insurance covers loss and/or damage of cargo while it is in transit between the points of origin and final destination. Goods may be transported by sea, air or land.

Marine Insurance is essential for businesses engaging in international trade, especially those shipping large quantities of goods by boat. Specific terms and benefits vary widely across the world, and many marine insurance policies are custom tailored for specific shipments, but a few general principles apply to the entire industry.

For more detailed information about what types of Marine Insurance is best for your shipping needs contact a UCM sales representative by calling 866-826-2276 or completing an online rate request form.

Protecting the value of your goods is the primary benefit of marine insurance. While you have the option of sending your freight without any insurance, if you do so you would bear the entire financial cost in the event of damage or loss of your shipment. You do have legal recourse against the carrier, but this can be a lengthy and complicated process, and international law strictly limits carrier liability, according to SITPRO, an export facilitation company in the United Kingdom.

Different types of marine insurance exist. Policies are available to protect the goods while in transit on the ship, but damage can occur while the ship is in port, while the goods are in transit to the warehouse or while at the warehouse itself. Marine insurance policies can be endorsed to cover all these instances, or a policy can be purchased individually to provide cumulative coverage for all locations of your goods.

The most comprehensive type of marine cargo insurance is called All Risks coverage. If you are shipping household good, personal effect or cars, all risk insurance is only available if the container is professionally packed and loaded by a professional company (not the actual customer). Otherwise the shipment is only insured for very a limited “FPA coverage”. 

Please download our Cargo Insurance Basics table for a comparison of different types of Marine Cargo Insurance.

Marine Insurance Exclusions

Most marine cargo insurance policies do not reimburse for losses caused by improper packing or when customs officials reject the delivered goods.

Other freight insurance policies exclude claims for:

• Abandoned cargo
• Other party failing to pay
• Spoilage or other damages due to the product’s nature
• Losses caused by shipping delays
• Employee dishonesty
• Damages at port cities more than 15 days after cargo was unloaded.

For example, improperly packed rice can expand and spoil while in-transit. This would not be covered under standard maritime insurance contracts.

Covered Risks under a Marine Insurance Policy

All Risks marine insurance would cover the non-delivery of an entire shipping package, including where theft was involved.

Total loss of the entire shipment would also be covered if due to a collision, explosion or burning involving the ocean vessel.

Other eligible risks to cargo include:

• Damages from bad weather
• Seawater or freshwater flooding
• Improper stowage by the shipping company
• Mud and grease damage
• Fumigation services.

Please download our Cargo Insurance Basics table for a comparison of different types of Marine Cargo Insurance.