Cargo Insurance
March 3, 2010 - International companies who often need to send their products to different countries, sometimes think that export insurance is good enough to cover the risk to their freight. However, cargo insurance is equally important for the cost recovery of the freight in untoward situations.
About Export Insurance
Export insurance provides a specialized coverage in the event of shipments to foreign countries as business dealings. The export insurance have such benefits as 'locally admitted coverage,' 'differences in conditions' or DIC coverage, and 'liability coverage.' Local coverage is certain specified insurance requirement that the foreign country, where the cargo is sent, needs the exporter to fulfill. DIC coverage fills in the gaps left by locally-admitted coverage, bringing it up to the requirements of the originating country too. Liability insurance coverage is for loss by negligence and covers legal fees apart from protecting the exporter from the stress and fees s/he incurs when dealing with foreign governments.
About Cargo Insurance
Cargo insurance is also referred to by many other names including marine insurance, freight insurance and logistics insurance. While an export insurance protects the exporter's shipment till it is in port. Once he freight moves for its destination, it does not protect it. Here, the exporter will need a cargo or logistics insurance. Before knowing more about it, know the basics of
logistics insurance.
There are many options while choosing the right marine cargo insurance policy. Open cargo policy coverage protects the basic nature of the cargo itself. For example it includes the value and shipping costs of the cargo. Voyage policy protects the cargo during a specific voyage for which the insurance policy can be purchased. There is also a war risk policy coverage that can be bought if the shipment has to pass through hazardous zones.
Freight insurance, in general, protects the cargo during transit from theft, accidents, and even shipwrecks. Cargo insurance, thus, has a broader scope when compared to export insurance. This type of insurance is essential for almost any business that has to deal internationally and also includes people and agencies like those of transportation brokers, freight forwarders, importers and exporters, as well as logistics providers. Cargo insurance can be for any mode of transportation including rail, sea, air, or truck.
