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Marine insurance simply explained
In international sales transactions, with goods generally having to be transported over long distances and being subject to a variety of hazards en route, the risk of loss of or damage to goods is relatively high. If the loss or damage does occur, profitability will be lost unless the goods are covered by insurance.
Marine cargo insurance is aimed at removing, as far as possible, the financial burden of the risks of loss or damage associated with the transportation of goods between exporters and importers, and placing it with specialist insurance underwriters. These underwriters are skilled in assessing risks, and they manage reserve funds (made up of premiums paid by others) out of which those who suffer losses can be compensated.
The terms and services relating to marine insurance are the same worldwide (with the exception of the USA) and are generally explained below.
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