In India, due to economic liberalization, the growth of export and import businesses has been exponential in the past few decades. There are products exclusively manufactured or provided by the Indian market that get exported to different countries. Likewise, to meet the demand of Indian consumers and users, products and materials from various countries are imported to this country. The basis of this product or material exchange depends mostly on the transit of the cargo that carries the goods. So, it’s no surprise that the risk of damage or loss of goods during physical transits is prominent.
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Using marine or water transportation mode for the export and import of goods always creates a higher relative risk of damage associated during transit. Any unpredictable situation during the transit can prevent the delivery of products, leading to substantial financial losses for any business. So, what can one do to avoid the repercussions of such loss or damage? Well, the answer lies with marine insurance companies who provide solutions against any financial losses or damage.
If you are a product manufacturer or deal with export and import services, it is crucial for you to understand the importance of a marine insurance policy. If you are not yet convinced, here’s how marine insurance companies can help you navigate through the risk factors associated with cargo transits.
What Can Marine Insurance Companies Do For Your Business?
Marine insurance companies provide insurance covers for any loss or damage caused to ships, cargo and terminals. They offer comprehensive marine insurance policies to curtail shipper’s exposure to any kind of loss related to finance or damages on goods. In other words, it is an insurance cover for goods or commodities while in transit.
International trade opens up multiple business avenues, but it also comes with its own risk. Therefore, marine insurance companies play a critical role in facilitating global trade networks by offering export-import businesses with insurance coverage to minimize risks.
Take a look at how marine insurance companies can help your export-import business and why you need marine insurance:
1. Safety Against Cargo Theft
Global supply chains get hampered as cargo thefts continue to take place. This disruption may result in the loss of millions of dollars – including direct damages and downstream costs. Marine insurance companies help you secure your products in transit and keep you prepared for any such incident.
2. Protection Against Unforeseen Disasters
Incidents like storms, shipwrecks, or piracy can cause financial harm to your business and result in the loss of goods in transit. Without an active marine insurance policy, you may end up losing the goods without receiving any compensation for the loss. Marine insurance companies help you avoid such problems and lower your risk by providing compensation benefits as defined by the chosen marine policy.
3. Fulfil Contractual Requirement Obligations
Some countries demand active marine insurance coverage before they accept or send goods to facilitate export-import through their borders. For example, port authorities of some countries ask for insurance papers as a part of the import procedure. At such locations, without marine insurance, your business can get impacted. Purchasing the right policy from marine insurance companies ensures seamless processing at ports that require insurance coverage as a mandate. When you have active marine insurance, you fulfil your legal obligations and get compensation in case of mishaps during the transit.
4. Relief against Limited Liability on Carriers
According to the Carriage of Goods By Sea Act, carriers are only liable from the period of loading the goods into the ship till their discharge off the ship. The carrier’s limitation of liability refers to the maximum amount for which you can hold a carrier legally liable for any loss or damage to cargo. By law, carriers cannot be held responsible for common incidents like natural disasters, strikes and fires. In situations where the carrier is directly responsible, the liability will still stay restricted. Marine insurance companies help you with covers that neutralize any loss or damage to your goods.
5. Customize Your Marine Insurance for Better Security
It is a tough task to run a business that involves the import and export of varieties of goods and commodities. Every exporter or importer should have a proper understanding of the benefits marine insurance policies bring, to make optimal use of this insurance. Marine insurance companies also offer customization in their plans, tailoring them to meet your business requirements.
If you are thinking of buying marine insurance, make sure to check the main benefits offered by the insurer. Renowned insurance brokers such as SecureNow provide various options for marine insurance at reasonable prices. Make sure to do proper research online before choosing the right policy. With a suitable marine insurance policy, you can stay assured that your marine insurance policy will help reduce the risks of loss and damage of goods in transit.
