People often wonder why they require an ocean freight shipping insurance policy; the answer is very simple – because it will minimize your exposure to financial risk to the lowest possible level. It is essential that anybody and everybody that is shipping goods and merchandise through ships should get an ocean cargo insurance plan to protect their goods, interests, and money. Not only will you end up saving thousands of dollars every year by avoiding loss or damage to goods but you will also save time and effort which can be put into much more useful things.
If you are still wondering whether you should opt for an Ocean Freight Insurance plan or not for your next shipment then read below to see the top 5 reasons why you should.
#5 Reasons Shippers Should Purchase Ocean Freight Insurance
The following are just a few reasons why you should get an insurance cover for the goods and merchandise that you are shipping –
- Exponential Rise in Cargo Theft Cases – Cases of cargo thefts are increasing at an alarming rate all across the globe; thieves utilize ways such as identity theft and fictitious pick-ups to steal cargo. Loss on such an unfortunate incident could easily run into thousands of dollars.
- Containers Lost at Sea – This is a case of concern for many shippers as the rate of containers being lost at sea has risen in the past decade. The huge stacks of containers that every ship carries also bears the risk of some of them going overboard. About 700+ containers are said to be lost at sea each year without the involvement of any natural calamity.
- Catastrophic Events – It is no news that sea-journey is indeed a risky one; bearing the risk of shipwrecks, storms, attacks, explosions and more. Every year numerous such incidents occur and it is always a good idea to insure your goods to protect yourself from loss.
- Damaged Goods – This is the most common kind of problem in almost all types of transportation and shipping options not just at sea. The huge stack of containers, rough handling of goods and other reasons contribute to damaged goods in almost every ship. Sometimes the goods can also be damaged during stowage or on the ports (either side).
- Limited Liability of the Carrier – The carrier has limited liability and under the law, it is not liable to pay for the loss borne by the clients in several circumstances such as Act of God (thunderstorms or other natural calamities). Shippers have to bear the heavy loss in such a case. If your goods are insured then you can save a lot of money in such a case.
Why should you buy your own Ocean Freight Insurance Policy?
You might find it tempting to leave the task of purchasing the insurance on the discretion of the buyer or seller; however, this is not a viable option. You should purchase the insurance on your own only after you are satisfied that the insuring terms, valuation of the goods and the limits provided by the insurer are suited for you. If you leave an important task such as buying the insurance on the other party, then you run the risk of not being adequately protected during the shipping process.
Moreover, in case the need to raise a claim arises, it is always better if you have to deal with an insurance company in your own country and one with whom you have already met; because, if you are dealing with a foreign company then differences such as language and work-culture would make it a frustrating process which might be completely futile as well. Also, in case of claim issue, the case would then need to be settled in a foreign court only. It is better to purchase your cargo insurance on your own than leave it to the other parties during importing and exporting transactions. It allows you to have more control over things.