MARINE CARGO INSURANCE ON AN OCEAN FREIGHT SHIPMENT
The majority of sea freight shipments shipped with international transportation companies arrives to destinations free of damage and loss.
However, shipper should be aware that ocean freight carriers in general are liable up to $500 per piece or package (i.e. box, skid, pallet etc). In most cases the ocean carrier’s (or other type of international transportation company) liability may be limited to $500 per entire international ocean freight shipment if you are shipping in a marine container (20 foot or 40 foot) or depending on how many packages or pieces you show on the Bill of lading.
If you would like to get an extra protection for your valuable shipment from US then we can obtain an Insurance Certificate issued to consignee’s (recipient’s) name. Note: If you need us to get an insurance certificate to a consigner’s (shipper’s) name, then it must be specified separately in email.
In case of insurance claim related to an international sea freight shipment from the USA, the claim will be processed by the Insurance Company's Claim Settling Agent located in the country of destination. Complete contact info of Claim Settling Agent is available in the Insurance Certificate.
If a sea freight shipment is not insured then all claims are to be directed to the steamship line (direct carrier, international ocean freight transportation company, i.e. owner of the vessel for your export from the USA) used on the shipment.
Typically, depends on commodity, for ocean freight shipments insurance rates vary:
In order to obtain an insurance certificate on your Ocean or Air freight shipment, a Commercial Invoice (for commercial shipments) or an Inventory or Packing list with values (for international personal shipments by sea) must be submitted in advance. (DOES NOT APPLY IF SHIP VEHICLES).
Please feel free to request a Quote for the insurance coverage at any time and as we represent several major Underwriters we can always be sure to give you the right coverage at the best rates.
For Personal Effects and Household Goods shipments (Unaccompanied Baggage) shipments you can download the Inventory Form from our site or request the Inventory via E-mail or mail at any time.
For Commercial Cargo a copy of the commercial invoice with the amount you wish to insure the good for will enable us to issue the Insurance Certificate.
You may request insurance for your shipment at a time of booking or any time before the shipment departs. The insurance premium can be added to the final invoice and Underwriters insurance certificate be attached in PDF file and sent to you via e-mail or mail.
You may also purchase insurance on your ocean freight shipment through any insurance agency of your choice.
OCEAN CARGO INSURANCE VALUATION
KNOW YOUR OCEAN CARGO POLICY'S VALUATION CLAUSE
The value of many shipments depends upon fluctuations in currency exchange, handling charges, manufacturing costs, freight charges and other expenses. It is therefore crucial to establish a basis for valuation prior to issuance of an open ocean cargo insurance policy.
Once the valuation basis is established, all shipment values declared by the assured should coincide with the valuation clause. The policy prohibits declaring a value on one basis for effecting insurance and on another basis for settlement of a claim.
Other manners for cargo valuation available to assureds are:
1.Low valuations 2.High valuations: excess of 10% 3.Market value 4.Selling price 5.Foreign currency based valuation 6.Valuations for seasonal products
Low valuations are ideal for an assured shipping merchandise to a branch where the cost of manufacture plus ocean freight represent the extent of the insurable interest. The underwriter should allow for premium credits due to the lower valuation clause.
Higher valuation can be used if the assured expects to incur claim-related expenses beyond the 10% advance.
Market value is used for commodities that have values which fluctuate widely within a short period of time. The valuation clause can address these fluctuations by valuing the product at the highest published price quoted by a specific Commodity Exchange during the period of risk.
Imported merchandise can be insured at the importer's resale price provided the value was agreed prior to shipment.
Import shipments and cross voyage shipments may have invoices in foreign currencies. Some reference to the conversion of these foreign currencies should be contained in the valuation clause.
Shippers of seasonal products should consider advances in excesses of the normal 10%. Based on the 10%, a severe claim can make it extremely difficult for a seasonal shipper to remain in business.
The valuation clause of an ocean cargo policy can be worded to accommodate almost any shipment. It may prove valuable to occasionally review your valuation clause to determine if it remains suitable for your business.
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