GOODS IN TRANSIT INSURANCE
Key features and aspects of GIT insurance include:Multiple Modes of Transport: Transport insurance is flexible and can be tailored to cover goods during various stages of the journey, regardless of the mode of transportation used. This includes coverage for shipments via trucks, ships, airplanes, or trains.
Cargo Value: The insurance coverage is typically based on the declared or agreed-upon value of the cargo being transported. The insured party, often the shipper or owner of the goods, determines the value, and the insurance premium is calculated accordingly.
Voyage or Open Cover Policy: There are two common types of transport insurance policies:
a. Voyage Policy: Provides coverage for a single trip or voyage, from the departure point to the destination.
b. Open Cover Policy: Provides continuous coverage for multiple shipments within a specified period, usually for a year. The policyholder declares the shipments to the insurer periodically.
Responsibility for Insurance: responsibility for obtaining transport insurance can vary depending on the terms of sale (Incoterms) agreed upon between the buyer and the seller. In some cases, the seller arranges and pays for the insurance, while in others, the buyer may be responsible for insuring the goods.
Claims Process: In the event of a covered loss or damage during transit, the policyholder (insured) must promptly notify the insurer and provide supporting documentation. The insurer will then assess the claim and compensate the insured for the financial loss, up to the insured amount or policy limit.
Risk Mitigation: Transport insurance is an essential tool for businesses engaged in international trade or shipping goods over long distances. It helps mitigate financial risks and provides peace of mind, especially when dealing with valuable or fragile cargo.
Additional Coverage Options: Depending on the insurer and policy, additional coverage options may be available, such as delay in transit, warehouse-to-warehouse coverage, and specific coverage for perishable or hazardous goods.
Transport insurance plays a crucial role in ensuring the safe and secure transportation of goods and merchandise globally. It provides protection to businesses and individuals against potential financial losses that could arise due to unforeseen events during transit. When engaging in transportation activities, it is essential for businesses to carefully assess their insurance needs and select appropriate coverage to safeguard their valuable cargo.