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Marine insurance
Marine Insurance
Marine insurance is a protective financial cover specific to the shipping and transport industry. It offers protection against potential losses related to the transportation of cargo from the cargo itself, to the ship the cargo is on and the liabilities surrounding it.
Why is marine insurance important?
In New Zealand, with its vast coastlines and heavy dependence on international trade, marine insurance acts as a safety net. It ensures that businesses can operate with confidence, knowing they’re shielded against unforeseen maritime mishaps, which can range from cargo damage to vessel collisions.
It’s crucial to have marine insurance if your business:
- Transports goods regularly.
- Owns/operates maritime vessels.
- Provides maritime services.
- Builds/repairs boats.
What are the types of marine insurance?
Marine cargo insurance
Single transit: Covers goods for a single journey.
Open transit: Provides ongoing cover for all shipments within a set period.
Marine consequential loss: Protects against financial losses due to delayed shipments.
Buildings in transit: Offers insurance for buildings or parts of buildings being transported.
Marine hull insurance
Fishing vessels: Tailored insurance for fishing boats.
Helmsman: Coverage specific to the ship’s pilot or helmsman.
Commercial hull: For larger, commercial vessels.
Boat builders: Protects those who construct vessels against potential risks during the building process.
Marine liability insurance
Carriers liability: Covers legal liabilities of a carrier in case of cargo loss or damage.
Marina operators liability: For those running marinas, ensuring against potential liabilities.
Charterers liability: Protects those who hire vessels for their use.
Ship repairers liability: Offers protection for entities involved in repairing ships.
Freights forwarders liability: Safeguards freight forwarders from potential losses related to their operations.
What does marine insurance cover?
Protection Against Damage or Loss
Marine insurance safeguards against the physical loss or damage to the vessel and cargo. This can be due to various reasons, including natural disasters, accidents, or even piracy. By having this coverage, businesses can ensure their investments remain secure.
Liability Coverage
It covers any legal liabilities that might arise due to the vessel's operations, including collisions, environmental damage, or injuries. This aspect ensures that if the vessel or its operation inadvertently harms another party, the insurance will handle the costs, protecting the business from potentially hefty legal bills.
Coverage Against Theft
Given that vessels, planes, trains, trucks and couriers often carry valuable cargo, theft can be a significant concern. Marine insurance can ensure that businesses are compensated if their goods are stolen during transit.
How much does marine insurance cost in NZ?
Marine insurance premiums are calculated on several different factors including:
- Type of coverage
- Journeys undertaken
- Sums insured
- Claims history
Marine insurance can range in cost from $60 for a small single cargo transit policy all the way up to hundreds of thousands for an extraordinarily large vessel.
Who needs marine insurance?
Any business involved in maritime or transport operations—whether that’s transporting goods, operating vessels, providing maritime-related services, or even constructing boats—needs marine insurance. This includes exporters, shipowners, charterers, marina operators, transport companies and boat builders, among others.
Regular business insurance typically excludes the unique risks associated with maritime operations. Marine insurance is specially designed to cater to sea-related and transport related risks, from shipwrecks to piracy, ensuring comprehensive coverage.
Yes, marine insurance can cover goods from the point of origin to the final destination, including any transshipments or stops. However the specifics of your policy. Typically the policy will state the incoterms that are insured which indicates what parts of the journey are covered.
How do I get proof of marine insurance?
You can usually get proof of insurance same day when you purchase marine insurance through Gerrards.
Acquiring marine insurance from traditional insurance brokers may require a few weeks, a delay that could create problems for policyholders who need instant insurance proof of marine insurance for a contract.
To obtain insurance coverage promptly, contact us. We may require you to provide some fundamental details about your operations, such as:
- The type of activity
- Values
- Dates
- Claims history
- Risk management strategies
What does marine insurance not cover?
Normal wear and tear
Marine insurance doesn’t cover the gradual deterioration of vessels or cargo over time.
Intentional misconduct
If a loss occurs due to deliberate actions or misconduct by the vessel owner, crew or transport company, it won’t be covered.
Nuclear reactions or war
Most policies exclude damages from nuclear events or acts of war.
Default of the carrier
If a carrier defaults or becomes bankrupt, the resulting financial loss might not be insured.
Other common questions about marine insurance NZ
Opting for higher deductibles, proving a good track record of operations, and installing safety measures can lead to lower premiums.
While marine liability insurance can cover liabilities related to injuries, dedicated crew insurance policies might be needed for comprehensive protection.
To file a claim, you’ll need to notify your insurance provider immediately after an incident, provide necessary documentation (like damage reports or police reports), and follow the claim procedures outlined in your policy. If you have your cover with Gerrards, get in touch with us. We will file the claim and advocate on your behalf.
Yes, modern marine insurance can offer coverage against piracy, given its prevalence in certain global regions.
Most policies come with territorial limits. Always ensure you’re covered for all regions your vessel operates in or cargo is shipped through. It is best to consult your broker for clarity.
