The time has gone when a merchant was only capable of exporting goods to particular areas. Today, you can trade on a global level. You can sell your products to anyone, living anywhere in this world.
And that’s called globalisation. Globalisation has increased the potential of businesses to earn profits. But great benefits come with greater risks. When you sell products all across the globe – your business comes under the risk of transport disasters.
When goods are being transported through water, air or land, the risk of damage due to unforeseen contingencies remains high. And when that happens, businesses suffer great losses.
That’s why a transit insurance or a freight insurance policy was introduced. It’s like Captain America’s shield protecting you from all the financial risks of transporting goods.
Let’s understand this policy in a detail:
Definition Of Transit Insurance Policy
Transit insurance is a type of insurance plan which covers the risk of damage to the goods that are being transported by insured. This insurance policy covers transit for air, road, water, and rail. Its premium depends upon- the value of the cargo in the transit and the total amount of risk the insured bears during the transportation period.
What All Things Does Transit Insurance Cover?
Transit or transport insurance covers all those common perils that may cause damages to the cargo in the transit. Some of the common perils against which this policy offers protection are:
- Earthquakes, Fire, Explosion, Theft, Lightning
- Overturning of the vessel in which cargo is being transported
- Any type of man-made or natural calamities
- Collisions of the vessel like accidents of the trucks, etc.
- If the vessel gets sink
- The derailment of the vessel
- Damages caused during loading and unloading of the cargo
- All types of accidental damages
- Damages during packing and unpacking of cargo
- Malicious damages
- Impact damage, etc.
Who Should Purchase This Insurance Policy?
Transit or freight insurance policy is necessary for individuals and businesses involved in daily transportation of goods. More specifically, the following types of parties can consider purchasing it:
- Manufacturers of goods
- Custom house agents
- Traders
- Importers and exporters of goods
- Transporters or aggregators
Types of Transit Insurance
Transit insurance is of various types and here are some of them:
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Single Transit Policy
This policy covers good for only one journey. It is suitable for all those businesses or individuals who do not transport goods frequently.
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Customised Policy
This transit insurance policy is highly flexible. Businesses can customise it according to their coverage requirement. Marine cargo insurance is a great example for this policy.
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Open Policy
This insurance policy covers multiple journeys within a certain period of time, usually one year. So if your business transports goods frequently, you can purchase this insurance and take the benefit of coverage for multiple trips without buying separate insurance for each.
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Overnight Vehicles’ Insurance
If your goods need to be stored overnight inside the vehicle, carrying the cargo, this policy is perfect for you. It covers your goods in all such cases.
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Goods In Transit Cover
If your goods are being transported in a third-party vessel, the carrier won’t take the responsibility for any damage to the cargo. It’s not an uncommon thing. Therefore, you can purchase this insurance to cover all the financial losses or damages to your goods, when they are being transported through another carrier service.
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Multiple Vehicles Cover
If multiple vessels are being used in the transportation of your cargo, this is the policy you need. It will cover all those goods together under a single plan. This way you don’t need to purchase multiple policies for multiple vehicles.
Final Words
We hope you enjoyed reading today’s detailed guide on transit insurance policy. If you want to make your goods transport safely from one place to another – purchase this policy from a reliable transit insurance company now!