Why you need export and import insurance

Why you need export and import insurance

If you have an international business, you might choose either air or water freight. Your merchandise, your source of income is going to travel the distance either from you or to you. It is not advisable to simply keep it unattended or without insurance. The journey might seem simple and easy but think of the variabilities that your cargo rests on. Keep reading to know the importance of insurance for cargo, be it import or export of goods.

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Formal obligation � Many companies or sales contract that you have may include insurance in your contract to avoid risk of damage to goods in transit. This is specially true for goods with CIF or CIP. If you are legally bound, you should not risk by not getting insurance as in case of damage, the financial loss that you will incur will be severe.

Minimize loss � There has been steady rise in cargo theft. You can be scammed by fictitious identity and your cargo might be received by others. Damage can also take place in transit. There are so many factors that can cause loss to your consignment. Lack of expert packaging or poor condition of container wreaks havoc on goods in containers. You should protect your export or import cargo with marine insurance against storm, possible shipwreck or even pirate attacks. Explosion on ship is also quite common leading to complete loss. It is also common for ships to get lost in sea. World Shipping Council estimated from 2008 to 2016, on an average 568 containers were lost at sea, not taking account catastrophic events.

As a shipper that should give you all the more reason to get insurance.

General average � It is a system where you have to pay a sum of money to obtain the release of your consignment. Insurance companies pays it up and helps is expediting release of cargo.

Carrier liability – Ocean carriers have certain liabilities but they are exempted from certain situations such as damage, delay or loss due to act of God, act of the shipper or the inherent nature of goods in transport. If you do not have insurance, the loss that you can incur under aforementioned events can take a huge toll on your business.
The most important reason as to why you should get cargo insurance perhaps lies in the fact that you are doing an international import or export, making any loss incurred more expensive and a tedious legal procedure. So the most sensible thing to do is getting the insurance yourself for your consignment.

To know more about Allegiance Marine Insurance , get in touch with the experts today.