Coverages & Terminologies of Inland, import, export Marine Transit Insurance | J insurance
Inland Transit insurance provides a cover to a person’s goods and personal possessions while being moved within a country. It covers only those items that are going to be transported through trucks, trains, rivers, and domestic transportation from one place in India to any other place in India.
International Sea and Aerial routes are not covered under this insurance cover.
Import Export Marine Transit insurance is a cover that provides protection to the insured’s cost of goods during the time they are being imported or exported through any means of transport. It applies to the goods being transported to a different country by means of transport like air, water, rail, or road.
Calculation of premium in both the covers
In Inland transit Insurance, the premium is normally calculated on the types of goods being carried. It is calculated on the basis of Value of Goods, Nature of Goods, Mode of Transport, and on the basis of coverages chosen.
Whereas in the case of Export and Import Insurance the premium is calculated on the basis of the following;
- Type of ship/air cargo/road transport mode
- Age of the ship/air cargo/road transport mode
- Valuation or cost of the ship/air cargo/road transport mode
- Trading and tonnage limits of the ship/air cargo/road transport mode
- Management and ownership limits
- Type of Insurance policy
Now under both types of insurance policies, there are 3 types of Inland, import, export Marine Transit Insurance. And these are:
- Marine specific Insurance
- Marine open type Insurance
- STOP Plan
Here’s a bit about all 3 of these policies.
1. Marine Specific Type Insurance: The specific export-import insurance is a type of policy that is valid and limited to providing cover to insured goods only for one particular voyage.
2. Marine Open type Insurance: The open policy is issued to cover several shipments/ despatches for the period of 12 months based on the Sum Insured which is sufficiently big and is adjusted against the value of each shipment or cargo in a reducing balance method.
3. Marine Sales Turnover Plan: STOP or Sales Turnover plan is an open policy in real terms but this one is made specifically for businesses who deal with a lot of shipments every day. The Premium For The Policy Is Charged Only On Your Sales Turnover.
Risks covered in both the policies
Generally, the Marine insurance providers provide assurance against all possible risks under three clauses.
These three marine cargo clauses are Institute Cargo Clauses (A), Institute Cargo Clauses (B), and Institute Cargo Clauses (C).
Institute Cargo Clauses (A):
Institute Cargo Clauses (A) covers maximum risks as a result it is also known as All Risks cargo insurance policy. Below you can find the details of the risk coverage of this type of insurance policy.
Insurance Cargo Clauses (A) covers all the risks of loss of or damage to the goods except the following conditions:
General Exclusion Clauses
• Loss damage or expense attributable to willful misconduct of the Assured
• Ordinary leakage, ordinary loss in weight or volume, or ordinary wear and tear of the subject matter insured
• Loss damage or expense caused by insufficiency or unsuitability of packing or preparation of the subject-matter insured to withstand the ordinary incidents of the insured transit where such packing or preparation is carried out by the Assured or their employees or prior to the attachment of this insurance (for the purpose of these Clauses "packing" shall be deemed to include stowage in a container and "employees" shall not include independent contractors)
• Loss damage or expense caused by inherent vice or nature of the subject-matter insured
• Loss, damage, or expense caused by delay, even though the delay be caused by a risk insured against
• Loss, damage or expense caused by insolvency or financial default of the owners, managers, charterers or operators of the vessel where, at the time of loading of the subject-matter insured on board the vessel, the Assured are aware, or in the ordinary course of business should be aware, that such insolvency or financial default could prevent the normal prosecution of the voyage. This exclusion shall not apply where the contract of insurance has been assigned to the party claiming hereunder who has bought or agreed to buy the subject-matter insured in good faith under a binding contract
• Loss, damage or expense directly or indirectly caused by or arising from the use of any weapon or device employing atomic or nuclear fission and/or fusion or other like reaction or radioactive force or matter.
Each marine cargo policy type covers a different amount of risks, whereas Institute Cargo Clauses (C) has the minimum coverage, Institute Cargo Clauses (B) has the medium coverage and Institute Cargo Clauses (A), also known as all risks, has the maximum coverage.
Institute Cargo Clauses (B):
Institute Cargo Clauses (B) is the medium cover cargo insurance policy available in the market. ICC (B) cargo insurance covers more risks than ICC (C) cargo clauses but covers less risks than ICC (A) All Risks insurance policies.
Below you can find the details of the risk coverage of ICC (B) insurance policy.
Loss of or damage to the subject-matter insured reasonably attributable to
• Fire or explosion
• Vessel or craft being stranded, grounded, sunk or capsized
• Overturning or derailment of land conveyance
• Collision or contact of vessel craft or conveyance with any external object other than water
• Discharge of cargo at a port of distress,
• Earthquake volcanic eruption or lightning,
Loss of or damage to the subject-matter insured caused by
• General average sacrifice
• Jettison
• Entry of sea lake or river water into vessel craft hold conveyance container or place of storage
• Total loss of any package lost overboard or dropped whilst loading on to, or unloading from, vessel or craft.
Institute Cargo Clauses (C):
Institute Cargo Clauses (C) covers very limited risks most of them which must be happen during the carriage in form of accidents. Below you can find the details of the risk coverage of this type of insurance policy.
Loss of or damage to the subject-matter insured reasonably attributable to
• Fire or explosion
• Vessel or craft being stranded, grounded, sunk, or capsized
• Overturning or derailment of land conveyance
• Collision or contact of vessel craft or conveyance with any external object other than water
• Discharge of cargo at a port of distress
Loss of or damage to the subject-matter insured caused by
• General average sacrifice
• Jettison
Definitions: General Average Sacrifice: There is a general average act when, and only when, any extraordinary sacrifice or expenditure is intentionally and reasonably made or incurred for the common safety for the purpose of preserving from peril the property involved in a common maritime adventure.
Jettison: The intentional throwing overboard of part of the cargo or some piece of the ship in order to save the ship or its cargo.
Exclusion Clauses Covering Insufficiency of the Vessel or Containers etc.
• Loss damage or expense arising from unseaworthiness of vessel or craft or unfitness of vessel or craft for the safe carriage of the subject-matter insured, where the Assured are privy to such unseaworthiness or unfitness, at the time the subject-matter insured is loaded therein
• Loss damage or expense arising from unfitness of container or conveyance for the safe carriage of the subject-matter insured, where loading therein or thereon is carried out prior to attachment of this insurance or by the Assured or their employees and they are privy to such unfitness at the time of loading.
Exclusion Clauses Covering War-related Risks
• Loss damage or expense caused by war civil war revolution rebellion insurrection, or civil strife arising therefrom, or any hostile act by or against a belligerent power.
• Loss damage or expense caused by capture seizure arrest restraint or detainment (piracy excepted), and the consequences thereof or any attempt thereat.
• Loss damage or expense caused by derelict mines, torpedoes, bombs or other derelict weapons of war.
Exclusion Clauses Covering Strikes, Riots and Civil Commotions Risks
• Loss damage or expense caused by strikers, locked-out workmen, or persons taking part in labour disturbances, riots, or civil commotions.
• Loss damage or expense resulting from strikes, lock-outs, labour disturbances, riots or civil commotions.
The basic insurance cover is also available with extensions/add-ons.
Whereas, in Import Export Transit Insurance the policy covers the risk of theft, piracy, and damage to goods while loading or unloading (which depends on icc or itc clauses)
but there are also certain other risks like violence, strikes, or a natural calamity that the insured has to opt for as an extra cover.
