Insurance is an important thing. It’s the only safety net you have when you’re faced with unpredictable and massive damage, be it to you, your business, or your valuables. For a small fee each month, you may be able to live with the peace of mind that your business will be safe no matter what happens. This is even more important if you’re an exporter transporting cargo on ships across seas and oceans. Changing tides and strong winds could result in damage. Keep reading to find out how you can insulate yourself from this damage.
1. Understand Your Needs
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The first step to getting the right coverage is to understand the kind of insurance you need. There are many different providers, and they all offer different kinds of coverage, whether it’s trans-Atlantic, over the Pacific Ocean, or nearby neighboring countries. Coverages that span a longer distance require bigger insurance premiums, which can consume your budget if it’s an unnecessary purchase. While doing this, research different marine insurance companies and note down the ones that have gotten the best testimonials and reviews from your coworkers and others in your industry.
2. Understand The Valuation Basis
Understanding the valuation basis you’re presented with when you’re approaching different insurance providers is key to getting a good deal. Before settling on a policy, your company will inspect your goods to determine the value of what you’re transporting. In the event of damages, the payout you get will be equal to the assessed value of the goods. If a company can make an accurate assessment, it’s called Actual Cash Value, which means you’ll be paid exactly what your goods were worth. If it’s difficult to determine the exact value of the goods, you and your company will have to agree to a predetermined payout. This can be riskier, as you could end up getting less money than what your goods were worth.
3. Choose The Right Coverage
Now that you’ve settled on an insurance provider and have seen the valuation, the next step is to consider the essential coverages you need. Remember that each coverage you get comes with its fees and set of caveats. All risk coverage is the broadest possible category, covering everything except the rarest risks, but it is also the most expensive. Named perils coverage specifies the risks covered by the insurance, while a voyage and open cargo policy covers only one or multiple journeys, respectively. Choosing the right coverage will not only ensure you’re covered in case of any accidents but will also prevent you from spending too much money on premiums.
4. Consider Extra Coverage
Depending on the nature of your cargo, as well as the route your ship will take, you could opt for extra coverage. It’s essential to assess your needs carefully, as this extra coverage includes risks that no other policy usually covers, and if you don’t need it, you’ll be spending money for no good reason. The most common coverage concerns are for war and refrigeration. If your cargo requires temperature control, refrigeration insurance will allow you to file for a claim in case the refrigerating system in your shipment breaks down. War coverage will allow you to get an insurance payout if your load is attacked, either due to war or other parts of civil unrest, like pirates.
5. Create an Emergency Response Plan
Now that you’re almost done with your insurance coverage plan, the last step is to coordinate with any security specialist you may have and your insurance representative to make an emergency response plan. Though you have insurance, the best outcome is always safe retrieval and safety of the cargo you are shipping. This can only be done if you have a robust plan in place. Your insurance representative can help you with this by providing contacts, and you can agree on an adjusted payout if part of the shipment is damaged and part of it remains intact.
Insurance is an essential part of everyday life, but it’s even more important in business and commerce. If you’re working in the maritime industry, you’ll be aware of how important it is that the cargo onboard cargo ships stay protected and insured. Each container can contain millions of dollars of material, and each ship can transport dozens of containers. However, it takes one wrong turn or unexpected weather conditions to scrap a ship and lose millions. To insulate yourself from this, you’ll need comprehensive insurance, which you can easily accomplish using this article.