Cargo Insurance

Cargo insurance is the oldest form of marine insurance. Written records go back to the times of the Phoenician traders, transporting goods between ports in the Medeterranean Sea. Now, cargo insurance coverages have evolved to meet the demands of today’s multi-modal forms of shipping.

Over $300 billion worth of commodities are shipped in and out of the United States annually. Depending upon location, cargo loss can be subject to a host of national laws and international conventions. One has only to read the terms on the back of an ocean bill of lading to see that the matter of risk and responsibility can be impossibly complex.

It is difficult enough for buyers and sellers to deal with the myriad of purchase, ownership, delivery and payment terms that govern a purchase. Most international shippers of goods by ocean or air rely on some form of cargo insurance to protect themselves against the risk of loss to their property. Cargo insurance frees the shipper from detailed knowledge of the various laws and conventions and, like the bill of lading or waybill, often becomes part of the cargo documentation.

Tank Farm Insurance

The cargo insurance underwriter has to evaluate and price the conditions of coverage. First, the underwriter will want to know if there have been any losses in the past and, if so, what is being done to prevent a recurrence. To do so, he or she looks at nature of the commodity itself - is it breakable or perishable. Will it rot, rust or stain? Will people want to steal it? What is the politicalsituation in the foreign location? What kind of security is employed in the port or warehouse? How bad are the weather conditions? What type of vessel will carry the insured cargo; is it old, new, liner carrier or tramp registry? Is it well protected from breakage, climactic conditions, theft, etc.? What kind of packing -- plastic barrels, crates, cartons, boxes or is it in containers? Is it stowed on deck or under deck?

There are a number of advantages for importers and exporters to have their own marine cargo policy rather than relying upon freight consolidators, forwarders or shipping agents:

Coverages can be tailor made to suit your exact needs. You control the coverage rather than having terms arranged by a third party.
Documetation is prompt and accurate -- with most marine cargo insurance companies, you can go on-line and issue your own shipping insurance documents.
Premium savings: Rather than just paying an insurance rate negotiated by somebody else, you can purchase the best pricing/conditions available.

As owner of the policy, you control the claims service.

"Automatic" coverage - All your shipments are covered under all-risk, open cargo policy -- by sea or by air -- until the policy is canceled.

For over thirty years, Northeastern Underwriters has been a source of cargo insurance protection to American shippers.

 

Ocean Cargo Insurance