Cargo Insurance

Question 1

Cargo Insurance

Answer 1

• cargo insurance is an insurance cover for marine goods, air cargo and post parcels. The purpose of cargo insurance is to protect goods against physical loss or damage, during transmit.
• through sea- Marine insurance
• through air- Cargo insurance
• The underwriter insures the goods against loss and damages caused by perils specified in the contract for a stipulated consideration, known as ‘premium’.
  -Causa Proxima – The insurer indemnifies if the losses arise only from the nearest cause
  -The insurance documents can be classified into three
  documents:
  (a) Insurance policy: The insurance policy sets out all the terms and conditions of the contract between the insurer and insured.
  (b) Certificate of insurance: It is an evidence of insurance but does
  not set out the terms and conditions of insurance. It is also known
  as ‘cover note’.
  (c) Insurance broker’s note: It indicates insurance has been made
  pending issuance of policy or certificate. However, it is not
  considered to be evidence of contract of insurance.

Question 2

RISKS COVERED IN CARGO INSURANCE

Answer 2

1. Maritime Perils: covered by God or manmade.
2. Extraneous Perils: These perils are caused due to faults in carrying, loading and unloading.
3. War Perils: These perils relate to loss due to war including civil war, revolution, rebellion and detainment of carrier, etc.
4. Strike Perils: This means damage or loss due to lockouts, strikes, labour disturbances, riots, and civil commotion and by any terrorist acting from political motive.

Question 3

TYPES OF CARGO INSURANCE POLICIES

Answer 3

Different marine insurance policies with
different risk coverage are as follows:
(a) Institute cargo clause A: This policy covers all the risks of loss or damage to goods. This is the widest cover.
(b) Institute cargo clause B: This policy covers risks less than under clause ‘A’.
(c) Institute cargo clause C: This policy covers lowest risks.