By law, all shipping carriers are forced to offer a minimum amount of cargo insurance. But as suggested, it offers limited coverage. As a shipper, you can purchase additional cargo insurance to further protect your merchandise. This would give your cargo coverage while it’s in storage and in transit until it reaches its final destination.
Cargo insurance and shipping insurance come into play, for example, when there’s a misdeclaration of a hazardous shipment, intentional or otherwise, beyond your control. The Maersk Honam case can serve as an exemplification of this: A major fire broke out on the vessel on March 6 while shipping through the Arabian Sea.
The Singapore-flagged vessel was on route from Singapore to Suez with 12,416TEUs on board when the fire erupted. As of April 17th, the fire was brought under control, although the Maersk Honam continued to burn more than five weeks after it started. Five crew members have been reported dead from the blaze. The amount of cargo destroyed is still unknown.
The incident was classified as a “chemical fire” and raises the question of good proper securements of cargo as well as the declaration and documentation of them. Each vessel’s stowage list is prepared based on the data on the specific manifest, provided by everyone that has cargo on board. These declarations have to be precise. As a worst-case-scenario measure, a shipper should have a cargo insurance. Misdeclarations are beyond the shipper’s control, and they can be covered with .
Having cargo insurance not only facilitates the post-shipping processes financially, but also logistically. Filing the claim with their insurance company will help speed up the process of releasing the cargo. Instead, without cargo insurance, your goods are subject to be held hostage for payment of charges and you risk to gain next to nothing at most.
If you are interested in acquiring a cargo insurance, either for your transported goods or a container unit, contact International Container Insurance (ICI) and get a quotation. To learn more about the insurance services we offer, click here or contact our offices today.
With information from: