Cargo Insurance - FAQ's
Cargo Insurance Policy
1. What is the legal status of Marine Cargo insurance?
There is no single law governing the practice of Marine Cargo insurance. The first codified legal guidance was the Marine Insurance Act 1906, adopted by the United Kingdom. The Government of Jamaica also adopted a version of the Marine Insurance Act in 1973. In practice, courts and insurance companies use a balance of international treaties, legal precedents and domestic laws.
2. What is an ‘Open’ Cargo Insurance Policy’?
An “Open” marine cargo policy automatically covers all shipments that fall within the scope of the agreed policy. The policy is usually written on a wide basis to cover all goods that are usual to your operation, and your normal shipping routes. The chief advantage of this type of policy is that you do not need to negotiate insurance for each shipment individually – you don’t even need to declare the shipment before it departs. You just enter the shipment details on our online platform, and you can instantly generate a Certificate. If a shipment falls outside the agreed policy, the system refers it to an IronRock representatives who will contact you and negotiate special terms for that shipment.
3. When does the coverage for each shipment take effect and then terminate?
Coverage is in effect while the cargo is being transferred between the place of origin and destination specified in the agreed policy (examples: port-to-port, warehouse-to-warehouse). If the contract of carriage is terminated before your cargo is delivered to its intended destination, then coverage expires when the goods are sold at its last port of arrival or 60 days after the arrival of the cargo at such port – whichever occurs first.
4. Can Cargo Insurance cover the inland leg of a shipment?
Sure. Cover can be extended to cover losses occurring inland, travelling by either air, rail or road.
5. Doesn’t the carrier accept liability when my cargo is lost or damaged by them?
There are many instances where a carrier is not liable (for example acts of God, force majeure, acts of war and perils of the seas). In these cases, a carrier can legally refuse to provide compensation for the loss or damage of the cargo. Carriers have limited liability under the IMO Conventions and typically their terms and conditions of carriage further restrict their liability. A carrier would not be liable to compensate you for General Average either.
6. How much should I insure my Cargo for?
Marine policies are said to be arranged on an ‘agreed value basis’. This means you can choose to insure your goods for their cost price, their cost price + freight, or even their expected sales price.
1. How long do I have to report a claim?
You should notify your IronRock representative of a potential claim immediately. Under the policy, you are also required to provide full particulars of the loss within thirty (30) days from the date of the incident.