What Are the Benefits of Having Marine Insurance?

Oct 12, 2022

Business Insurance

What Are the Benefits of Having Marine Insurance?

Businesses that ship goods over water use marine insurance to protect their assets and those of their clients. Global manufacturers ship products around the world to distribution centers. Other businesses ship products directly to consumers. Transportation companies such as exporters and importers carry this coverage. These companies need marine insurance benefits in case shipped items are damaged or lost during the journey.

What Are the Coverages Included in Marine Insurance?

The different types of coverages under marine insurance focus on protection for goods being shipped across the sea. Covered perils typically relate to natural disasters, theft, hijacking, and improper handling. For specific marine insurance benefits, you'll need to work with an insurance agent to discuss your options based on your company's risks. One type of marine insurance policy is called a floating policy, also known as a blanket policy. It's for exporters that regularly ship items instead of insurance for each separate shipment. The policyholder may need to report to the insurer details of goods periodically. It contrasts with a voyage policy, which covers a single lot or consignment shipment. You'll need to set up a separate policy for each shipment. Without marine insurance, business owners who ship goods overseas can get stuck with huge financial losses if the watercraft crashes. Some policies only cover shipped items while they are in transit. If damage occurs while the items are stationary on a parked ship, there's a chance they need extra specific coverage, such as port risk insurance. The policy should state which locations in the transportation process are covered.

Marine Insurance Benefits

Boat owners and companies paying for shipping by sea can avoid financial losses from shipping disasters by carefully customizing a marine insurance policy. A large importer, for example, needs a different policy than a company that pays a shipper to transport items. Here are some of the key benefits of a marine insurance policy:

  • Pays expensive repair costs - When a watercraft is damaged as the result of an accident, marine insurance pays the high costs of repair. Some boats cost several thousand dollars to repair.
  • Liability protection - If you own the vessel that transports goods for other companies, you can be held liable for damages that occur during shipping. These damages may be the result of faulty actions taken by the crew. This coverage pays for legal costs if your company is sued.
  • Collision protection - A vessel owner can be held responsible for damages when its vessel causes an accident at sea. The marine insurance coverage pays for losses, including attorney fees and legal settlements, for at-fault collisions. Without this coverage, the owner could be devastated financially by legal costs.
  • Protection from theft and vandalism - You never know when someone in the transportation industry is a thief and tries to steal inventory items being shipped. Missing items still go unexplained, even with the advent of RFID chips embedded in products for tracking. Marine insurance pays for the replacement of lost or stolen items.
  • Gain peace of mind - Perhaps the greatest short-term and long-term benefit is you'll have peace of mind that all your shipped items will be financially protected.

Get Customized Coverage with Graystone Insurance Group Today!

Every boat owner or shipping company should consider marine insurance if it uses vessels for commercial distribution. The key is to customize your policy to match your business risks. Would you like more information on marine insurance benefits? Contact us at GrayStone Insurance Group, and one of our team members will be happy to answer your questions.