Explained Knowledge of cargo insurance by Video
Hello, it’s IINO.
Following on from the previous video, I would like to explain about cargo insurance.
In the previous video, I explained the terms of cargo insurance and the calculation of insurance premiums.
For those who haven’t watched it yet, I post a link in the overview section, so please take a look.
2nd! The basic knowledge of cargo insurance
This time, I will explain the details as follows;
・Type of insurances
・Timing of application
・What to do in the event of a cargo accident
Let’s get started.
Types of Cargo Insurance
There are two types of cargo insurance, individual insurance and comprehensive insurance.
Individual insurance is something that is insured separately for each shipment. You must apply to the insurance company each time you ship.
Therefore, you need to be careful not to forget to apply for it.
On the other hand, comprehensive insurance is a type of one which you tell the type of cargo to be shipped, the transportation, and the transportation route for the year to the insurance company and then the actual shipments are insured together on a monthly basis.
Although insured collectively, it is necessary to contact the insurance company for individual transportation details after transportation.
This comprehensive insurance is more convenient if you have continuous shipments, because it prevents you from forgetting to take out the insurance.
Confirm the Incoterms
You should take care of the Incoterms before applying any insurances. Because you need to check whether the contract already includes insurance or not by the Incoterms.
For example, if an import shipment is FOB contract, the importer needs to apply for insurance. However, if it is a CIF contract, there is no need to apply because the exporter already has insurance.
In the case of CIF, the importer needs to apply for domestic cargo insurance from the importing point to the destination.
However, if this is the case with DDP, etc., the exporter may be able to arrange insurance for you, so it is best to check thoroughly beforehand.
Timing of application for insurance
When exporting, you can apply for insurance as soon as the vessel is scheduled to be shipped.
Please keep in mind that you should apply for insurance before the vessel is shipped in case of exports.
When importing, it would be nice if you could apply for insurance by getting information before the ship is loaded. However, you could mostly confirm the vessel with getting the B/L and other documents after the ship is loaded.
Let’s have the insurance, before the vessel arrives at the port of import at the latest.
When accident occurs
What should we do if an accident occurs?
First, you should contact your insurance company.
Then you should have insurance policy, insurance claim form, copy of B/L, invoice, devanning report mentioned damage and accident notice (claim notice).
You may also need photos of the accident. You can ask the forwarder for these documents and they will provide them for you.
I have explained about cargo insurance in the past two videos. In my opinion, it is better to have cargo insurance for the risk of international transportation.
If you apply for cargo insurance, the timing of the application is important.
In the case of exports, the timing for applying for insurance is before the cargo is loaded onto the vessel. For imports, it is before the vessel arrives at the port. Don’t forget to complete the necessary procedures.
If you know the basic knowledge of cargo insurance so far, you may have understood that it is not difficult to arrange insurance by yourself.
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That’s all for this time! Thank you!
Contact to IINO san