Marine Cargo insurance has been referred to as the handmaiden of commerce. It is an intrinsic part of international trade and is required by anyone engaged in the movement of goods.
Many people believe that the term Marine Cargo insurance only covers goods that are shipped by sea - this is not the case. Marine Cargo insurance encompasses transportation by Sea, Air, Road, Rail, Post, or by any combination - from origin to destination.
Marine Cargo insurance indemnifies the owner of the goods against physical loss or damage that may have been incurred as a result of a peril insured against during the transit.
There are many risks which goods face as they move between countries despite improvements in packing and methods of transportation. Loss or damage from accidents to vessels and other conveyances, breakage, theft, water damage and hijack are common problems. In addition, with valuable goods moving around the world, banks often insist that the buyer or seller arranges insurance to safeguard their interest particularly when loans have been advanced on the transaction.
Marine Cargo insurance enables world trade to be undertaken between buyers and sellers in different countries. There is a framework within which international trade operates defining the responsibilities of both buyer and seller in respect of all aspects of the transaction, from arranging transportation to insuring the goods.