Although rare, sometimes bad things happen.

Cargo insurance (also called marine cargo insurance) covers physical damage to, or loss of your goods while in transit by land, sea and air and offers considerable opportunities and cost advantages if managed correctly.

Traders need to be aware that coverage for international shipments can vary from the traditional, domestic coverage they may be used to. Many importers assume that the suppliers are including the marine cargo insurance for free when, in fact, marine cargo insurance is extra.

Many traders do not want to become involved in arranging marine cargo insurance because they feel they do not have sufficient knowledge. Remember, Marine Cargo Insurance for international shipments must be purchased and is not free.

Marine Cargo insurance is usually provided by the means of one of three Institute Cargo Clauses - A, B or C, plus War Clauses and Strikes Clauses. Simply put Cargo Clauses A provide the most cover with B and C giving less coverage which is reflected in reduced premiums for the lower cover (somewhat similar to car insurance cover with comprehensive, third party, fire and theft, and third party policies). Also there is an Institute Cargo Clauses (Air) for movement by air, which is equivalent to the A clauses. Your insurance company or broker will be able to give details of exactly what cover is given by each clause so you can choose the most appropriate for your business needs and trading patterns.

Another important issue is the type of cover being provided - is it comprehensive 'all risks' or just 'total loss' only? Is it on a warehouse to warehouse basis or just warehouse to port?

Traders should remember that carrier liability is strictly limited by internationally agreed conventions.

Click here if you would like to quote or purchase marine insurance.