7 Answers to Your Questions About Marine Insurance

Marine Insurance FAQ - Visual representation complementing the blog post, providing answers to common questions about marine insurance.

Somewhere in Delhi, it was a lovely morning to talk and exchange ideas. That's why Shilpa and Satish decided to meet at Starbucks. They were in a reputed shipping company's operations department (Imports and Exports). As they sipped coffee, they started discussing how this year has been demanding for businesses worldwide. The pandemic has left a devastating trail, and while companies are struggling to stay afloat, they must embrace and prepare for any uncertainties in future.

How is it going for you? Said Shilpa.

Satish replied, “Well, I am stressed about our cargo shipments. Yesterday, a severe storm lashed the UK, Germany and the Netherlands, and I was worried that we would lose our shipment, which was worth Rs. 50 crores. Luckily, there was not much damage. However, I want to mitigate the risks associated with overseas cargo”.

Have you thought about marine insurance? said Shilpa. Almost every international business works with this principle.

Well, I am not sure. I have a lot of questions. Haven't found any article that solves all my doubts, said Satish.

Shilpa smiled and calmed Satish.

“Let us find one!” said Shilpa. Once your questions are answered, it will help you find the right marine insurance policy.

Answers to your questions about marine insurance.

  • What are the objectives of marine insurance?
  • Marine insurance is a contract of indemnity that covers loss or damage to ships and cargo in transit from one point to another through various transit modes like rail, road, sea, air and courier. It covers

    • Damage to the ship
    • Damage to hull and machinery
    • Any loss to the cargo during the actual shipment

    Marine insurance policy will protect the finances and assets of an individual or business while they are transporting via the sea routes.

  • What are the features of Marine Insurance?
  • Any marine insurance has the following features.

    • Agreement: A marine insurance policy is an agreement between an insurer and the insured. Various terms may be unique, but the underlines remain the same.
    • Consideration: No insurer will provide indemnity to the insured without consideration, i.e. insurance premium. The insurance company offers coverage in exchange for a premium.
    • Coverage and Indemnity: The insured receives coverage and indemnity and will be indemnified against any losses that may occur up to a certain coverage amount. This ensures the continuity and stability of their business.
    • Period: A marine insurance contract can be of varied periods, i.e. single voyage to contracts that last for a year or multiple years.
    • Legal Document: A marine insurance policy is a legal document that can be used to file a suit in court.

    But DgNote facilitates a marine insurance policy that has additional features other than the above. It provides:

    • A secured Cloud-based application.
    • Easy-to-use application at the click of a button.
    • 24x7 dedicated underwriting and claims support teams.
    • API for seamless integration with ERP applications.
    • Attractive discounts for logistics service providers.
    • Lowest premium rates.
    • A one-stop solution for all insurance policies.
  • How can I calculate marine insurance premiums?
  • The insurer calculates a marine insurance premium based on risk estimates provided by the insured. Below are some of the parameters that are taken to figure out the risk:

    • Natural risks that are associated with the transit of goods.
    • Type of commodity, as some commodities such are fragile, Over Dimensional Cargo (“ODC”) are prone to higher risks.
    • Terms and conditions of the policy determine the inclusions and exclusions.
    • The value and nature of the goods also play an important role in evaluating the premium amount.
  • What are the benefits of taking marine insurance from DgNote?
    • FREE registration process.
    • Lowest premium rates in the industry (open policy and transit policy).
    • Special insurance discounts available to logistics service providers.
    • Real-time issue of the marine insurance policy.
    • Automated claim process initiation online.
    • Automated reports and reconciliation on a real-time basis.
    • Interactive dashboard to manage policies, invoices, receipts, etc.
  • What is the difference between a total loss and a partial loss in marine insurance?
  • Marine insurance plans make it easier to cope with any damages to cargo. So, to first raise a claim, you must clearly know the total retrieval amount.

    Marine losses can be categorised into two types, i.e., total loss and partial loss.

    • Total loss: In these cases, goods are completely lost or damaged. For an actual total loss, the title of the goods will be transferred to the insurer once the claim is settled. For a constructive total loss, the cargo is not destroyed entirely, but restoring it to its original state is not practical. In this situation, the interests are surrendered to the insurer, raising a claim for total loss.
    • Partial loss: In these cases, only a part of the goods is insured. For example, in particular average loss, if the goods are damaged due to flooding, then the compensation will be made if it is included in the list of covered perils. The general average loss is an expense done voluntarily to avoid grave danger.
  • Why is Marine Insurance Important in Foreign Trade?
  • The shipping industry has gone through a different set of challenges over the years, and many more will come in the future. The growing risk of piracy, rising costs, accidents, collisions due to human error, and damage to stock during the loading or unloading of the cargo are all too common. Also, a majority of foreign trade goods are transported by sea. The accidents affect shipowners, cargo owners, and carriers and having a marine insurance policy helps to reduce that risk and conduct business safely. Overall, marine insurance increases the number of indirect exports.

  • What are the types of Marine Insurance?
  • Marine Insurance is of two types, i.e. open policy and specific policy. To know more, check out our blog "Everything you need to know about marine insurance"

    The main aim of marine insurance is to protect your finances and assets while they are at sea, provide you with peace of mind and back up when you fall on hard times. DgNote is a global technology company that empowers its customers to optimise the supply chain by offering cost-efficient and customer-centric solutions. We provide intelligent, easy-to-use marine insurance solutions. DgNote transforms how businesses interact with each other and invites you to be a part of this exciting journey!

    After reading this article, do you still have doubts? Don't worry, just give us a call. We are here to help you.

    Prevention is better than cure. Empower your business with DgNote.

    For more information contact us at sales@dgnote.com or +91-90040 54921.

Next Post
Any Queries

Connect With Us & Get It Resolved

Our Expert Team is Ready to Answer Your Marine Insurance Questions.
contact us

Enter OTP sent to your mobile number

Enter valid OTP

Didn't Receive OTP? Send again in 30 seconds Send again