What Is Marine Insurance? Everything You Need to Know
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What Is Marine Insurance? Everything You Need to Know

If you’re running a business at sea and are importing and exporting goods, then you are going to need to consider marine cargo insurance – or, at least, marine insurance coverage.

This type of cover helps to not only protect your business and your customers’ interests, but also any stock you may be carrying, too.

However, the world of marine insurance can get a little complex.

Keep reading, and we’ll let you in on what you need to know about different marine insurance policies – and what marine insurance covers.

What Does Marine Insurance Mean?

A marine insurance policy is one which covers any form of business or professional operation involved in freight or cargo at sea.

An insurance provider offering this type of cover to ship owners will protect both vessels and cargo alike – meaning that you are effectively covered in the event of any loss or damage.

As you may imagine, the risk of either may end up costing you, any customers and professional partners dearly in the long run.

However, there are different types of marine insurance – there are policies that generally cover your goods, and others that focus on liability insurance.

Crucially, the aim of any kind of marine freight insurance is to protect you from escalating expenses, as well as from losing business over time, too.

What Does Marine Insurance Cover?

The average marine insurance policy covers plenty of ground. You’d normally expect a business or cargo voyage policy to cover:

  • Accidental damage to cargo
  • Marine risk – potential ship damage and deterioration
  • Capsizing and running aground
  • Hull insurance
  • Loss of goods / cargo
  • Weather or natural damage or loss
  • Cargo loading concerns
  • Theft
  • Malicious damage
  • Machinery insurance (breakdown cover, etc)
  • Third party liability
  • Physical damage in any shape or form
  • Partial loss and total loss when transporting goods

As a cargo owner or ship owner, if there is any risk to a loss of goods or to the structure and stability of your ship, it’s likely you will be able to find a policy that protects your interests.

In fact, insurance company policies will vary in terms of flexibility and scalability, meaning you may be able to add and subtract specific ‘tweaks’ to your policy as you see fit.

If you work in the marine industry, it’s also likely to will need to load on land as well as off land – meaning it’s worth researching the insurance market to see how you can cover your specific interests and intents.

What Are Some Examples of Marine Insurance?

It’s true – there are many different types of insurance policy that affect the marine industry.

No matter what you do – full shipping company operations to individual marine services, it pays to make sure you are insured against a variety of different risks.

Let’s take a look at how different types of marine insurance can provide coverage for your daily operations.

Liability Insurance

This type of marine policy will cover you should any collisions or accidents result in your liability.

For example, if you accidentally run a cargo boat or ship into rocks or even another vessel, you will expect to pay fees.

Liability insurance coverage will, variously, see that you have the financial backing to cover this potential scenario.

Providing you operate your vessels and ship cargo carefully, there are no reasons why liability insurance should ever be necessary.

However, as with other types of insurance policy, it makes sense to have a form of safety net in place should the worst case situation ever come to pass.

Third party liabilities covered by marine insurance allows for any costs you need to pay to other boat owners or cargo owners on route.

Should you be required to pay a plaintiff in court, for example, this policy will cover you as such.

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Freight Insurance

You’ll need to consider this type of marine insurance if you wish to protect the cost of goods that you transport.

Imagine that something happens to the stock you have on board that results in disappointment at the other end.

What if your customer’s goods are irreparably damaged or even lost (through theft or otherwise) while on route?

If the cargo you agree to ship doesn’t make its final destination for whatever reason, then it stands to reason that you will be expected to pay for the loss.

This type of marine insurance policy is also known as marine cargo insurance.

Of course, there are always likely to be individual clauses and points to keep in mind with this type of cover.

Therefore, it’s a good idea to look into what’s expected from you while in transit sailing under this policy style.

Hull / Risk Insurance

Of course, in any stretch of maritime or international trade, there is always likely to be a risk to your own hull – and your cargo vessels will need protection in case you happen upon an accident, or even a collision or malicious event that cause you severe damage, Repairing cargo ships is not a cheap business!

This type of marine insurance will, therefore, assess any damage caused to you and pay should you not be found liable for said problems.

For example, if your boat runs into oil pollution or other risk factors outside of your control, you may expect financial reparation.

Wreck removal, at the very worst, may come into play if your boat cannot be rescued at all.

Whichever marine trade you are involved in, you can trust your vessel with Velos. Start your boat insurance policy quote now by clicking on the quote button below:


Working in the shipping industry, you are unfortunately going to come across some dangers which makes marine trade insurance a must.

If you’re not operating in the US, you won’t have to worry about extensive cover such as inland marine insurance – but it’s crucial to make sure you are protected with a policy document to cover your boat, your crew, and any cargo you intend to carry from one end to another.

Ultimately, it could make all the difference between having to pay out hugely for unavoidable damage, and not at all.

Therefore, do always take time to research policies that stand to protect you.

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