Introduction to marine insurance

Are you looking for a guide to help you understand what marine insurance is?

If yes, then you are in the right place. Insurance is an important aspect, no matter which industry you belong to, and the marine sector is no different.

After all, the marine industry has the logistical responsibilities of transporting and protecting people’s and companies’ cherished goods and valuable assets. Hence marine insurance becomes a requirement. Let us dive a little deeper into marine insurance, how it works, and all you may need to know.

What is marine insurance?

Marine insurance offers coverage for any damage or loss related to ships, cargo, terminals, transports, or transfer. Simply put, a marine insurance policy will cover any loss or damage surrounding the boat or watercraft.

Of course, certain criteria define the coverage and what it may entail, such as whether your boat or vessel is on-shore, out of the water, sitting in your garage, or stored at a boat club. This will determine the safety aspect impacting your coverage premiums.

What Does a Marine Insurance Cover?

Marine Insurance will mostly cover the following:

• Physical or structural damage to your vessel due to collision with another submerged or above-water vessel.
• Damage to your or others’ property on board and bodily injuries.
• Towing, assistance, and gas delivery in case you find yourself stranded on the boat.

Marine insurance will also cover your ship and cargo if you face any problems while transporting goods. Moreover, it will cover liabilities in the event of damage or loss of the goods.

That said – it is your responsibility to ensure that you have adequate marine insurance, especially when dealing with commercial transportation of customers’ goods and belongings. This will help you gain a customer’s trust by providing an insured service.

Types of Marine Insurance

There are several types of marine insurance cover to cater to different needs. Let us see what they are.

1. Freight Insurance

Freight insurance protects a merchant ship’s owning corporation, because they are prone to losing money in freight. For example, if you lose the cargo due to an accident, freight insurance will cover the losses.

2. Freight Demurrage and Defense Insurance

This one is commonly known as FD&D or defence. This marine insurance covers legal costs claims and handling assistance for a broad range of disputes not covered by P&I, Hull, or machinery insurance.

3. Hull Insurance

This marine insurance covers your vessel’s hull and torso, along with other pieces and articles of the ship’s furniture. You can take out hull insurance as an owner to avoid any damage or loss to your ship, boat, or vessel in case of an accident.

4. Liability Insurance

A liability marine insurance policy offers compensation for any liability caused due to your ship colliding or crashing, or any form of induced attacks.

5. Marine Cargo Insurance

If you are a cargo owner, you are at risk of mishandling the cargo at any stage, i.e., from handling at the terminal or during the voyage. This may result in loss, misplacement, or damage to the goods. Therefore, to protect your interest as the cargo owner, marine cargo insurance will cover your losses against an adequate premium payment.

6. Machinery Insurance

This insurance coverage gives you protection for all essential machinery on-board. The insurance company will compensate for any operational damage to the ship. However, it will require a survey and approval from the surveyor.

7. P&I Insurance

P&I stands for Protection and Indemnity Insurance, provided by P&I club. This club is a shipowners’ mutual insurance coverage service to focus on the damages or losses to third-party goods that other standard marine insurance policies may not cover.

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