A simple definition of the word insurance would be “Protection against future loss.” Marine insurance is another variant of the general term ‘insurance’ and as the name suggests is provided to ships, boats and most importantly, the cargo that is carried in them.
Marine insurance is very important because through marine insurance, ship owners and transporters can be sure of claiming damages especially considering the mode of transportation used. Of the four modes of transport – road, rail, air and water – it is the latter most which causes a lot of worry to the transporters not only because there are natural occurrences which have the potential to harm the cargo and the vessel but also other incidents and attributes which could cause a huge loss in the financial casket of the transporter and the shipping corporation.

Types of Marine Insurance

Before going ahead with buying a marine insurance, you should be aware of the types of this insurance in order to be able to choose the most suitable one for your business. The types are:

Hull and Machinery Insurance: The hull is the main supporting body of the vessel without masts. Thus, hull insurance covers the applicant from any mishap to the ship. It is generally taken by ship owners. Along with hull insurance, one should also go for machinery insurance to cover the machinery of the ship. It insures the applicant against operational, mechanical and electrical damage to the ship machinery. Since both the sections cover the ship as a whole, it is jointly issued as Hull and Machinery Insurance by the insurance company.

Marine Cargo Insurance: Cargo owners are exposed to the risk of mishandling of the cargo at the terminal and during the voyage of the ship. It might get damaged, lost or misplaced. Hence, to protect the cargo owner from the financial losses arising out of such cases, marine cargo insurance is issued against appropriate premium payment. It comes with a third-party liability insurance which covers any damage done to the port, railway track, ship, other cargo or humans due to your cargo.

Liability Insurance: The ship may be exposed to crash, collision or piracy attack. Under such situations, the valuable cargo is exposed to a high risk. Moreover, the life of crew members and others on the ship is also in danger. The appropriate liability insurance indemnifies the ship owners out of any such liabilities due to events not under his control.

Freight Insurance: This section covers the loss of freight. In case the freight is lost or damaged or the ship is lost, the shipping company will not have to bear the loss. They can be compensated for the loss through this insurance.

Companies Offering Marine Insurance in India

Looking at the fact that India is surrounded by water from three sides, shipping is an important sector. A big volume of cargo is managed at these ports, making this insurance an important requirement. Some of the companies providing marine insurance in India are:

• All major banks and financial institutions
• HDFC Ergo
• TATA AIG
• United India Insurance Company
• Royal Sundaram
• New India Assurance Company Limited
• Bharti AXA