Inline Transit Vs Marine Cargo Insurance

New Delhi [India], October 7: You have just started your business and are excited to ship your first big order to a client in another city. You carefully package the goods, book a reliable logistics service and track the shipment. But midway, you receive a distressing call— your shipment has been damaged due to rough handling. You start wondering, how will you recover your losses? This is where transit insurance comes into play, but should you opt for Inline Transit Insurance or Marine Cargo Insurance? Let's discuss.

What is inline transit insurance?

Inline Transit Insurance, also known as Goods-in-Transit Insurance, provides coverage for goods while they are being transported across various stages of the supply chain within the domestic borders. It covers shipments from the seller's premises until they reach the buyer's designated location.

For example, suppose you own a company in Mumbai and are shipping electronics to Delhi using a logistics provider. If some of the goods are stolen during transit or, in another scenario, if the logistics truck collides with another truck and the goods inside get damaged, the insurer will compensate for the losses suffered.

What is marine cargo insurance?

Marine cargo insurance protects your goods from damage or loss while being transported by sea, air or land. If you are an importer, exporter or business owner shipping valuable products beyond domestic borders, this insurance ensures that unforeseen events, like storms, theft or accidents, don't leave you facing financial losses.

Suppose you run an export business in India and ship textiles to Europe. You load containers onto a cargo ship, but a storm damages the goods during the journey. Without marine transit insurance, it would be your responsibility to bear the entire loss, potentially disrupting your business operations and causing financial constraints.

Key difference between marine cargo vs inline transit insurance

Here is a detailed comparison between marine insurance policy and inline transit insurance:

Aspect

Marine Insurance

Inland Transit Insurance

Definition

It covers risks associated with the transportation of goods overseas, air or international routes.

It covers risks related to the movement of goods within a country by road, rail or inland waterways.

Scope of Coverage

The coverage scope extends to international shipping and coastal transportation.

The policy benefits are limited to domestic transportation within national borders.

Applicable Businesses

It is suitable for exporters, importers and businesses involved in global trade.

It benefits businesses operating within a single country and requiring frequent domestic shipments.

Types of Risks Covered

It includes perils such as sinking, collision, piracy, fire, natural disasters and cargo loss at sea or air.

It covers risks such as accidents, theft, fire and damage during transit via land transport.

Duration of Policy

The policy covers goods for the entire transit duration, including loading, unloading, and temporary storage at ports.

It covers goods only during inland movement from one location to another, not during storage.

Policy Variants

Common plans include open cover, voyage policy, time policy and mixed policy to accommodate different types of shipments.

Common coverage includes a single transit policy (for one-time shipments) and an open policy (for multiple transits within a specified period).

Premium Cost

Since the scope of coverage is broader, and the risk is higher due to international routes and adherence to multiple laws, the premium is costly.

Comparatively lower as risks in domestic transportation are lesser.

Claim Process

Involves complex documentation due to international trade policies, shipping contracts and port authorities.

Comparatively simpler as it involves domestic claims and local transport documentation.

Claim process for inline transit and marine cargo insurance

The claim process for both insurance products is almost similar, but there are major variations in the list of required documents. Here are the common steps involved:

• Step 1: Collect all necessary documents, including the insurance policy, bill of lading, invoice, packing list and any proof of loss or damage.

• Step 2: Promptly inform your insurance provider about the incident and your intent to file a claim. Provide basic details such as the policy number, date of loss and nature of damage.

• Step 3: Complete the insurer's claim form accurately. Include comprehensive details about the shipment, damage and supporting documents.

• Step 4: Attach all relevant evidence, such as photographs of damaged goods, inspection reports and correspondence with carriers or suppliers.

• Step 5: Prepare an estimate of the loss or damage incurred.

• Step 6: Compile all documentation into a comprehensive claim package and submit it to your insurer within the stipulated time frame.

• Step 7: Stay in touch with your insurer to monitor the progress of your claim. Respond promptly to any requests for additional information or clarification.

• Step 8: The insurer will reimburse the claim account to your business bank account upon approval.

Conclusion

Choosing between inline transit cover and a marine insurance policy depends largely on your business's shipping needs and the extent of international involvement. Marine cargo insurance offers comprehensive coverage for global shipments. It protects against risks during transit across sea, air or land. On the other hand, inline transit insurance is meant for domestic transport within a country's borders and covers only inland transportation risks.

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