How to manage insurance for international freight ?
The terms of sale agreed in a commercial transaction defined who is responsible for the shipment of goods. In other words, they specify who – the buyer or the seller – pays for:
– The acquisition of documents
– Licenses and Permits
– Freight forwarding agent
– Customs duty and taxes
The terms also show how the risk of loss or damage will be managed. They specify the delivery points of the cargo and how the risk is transferred from one party to another.
INCOTERMS are the most common terms used for international shipments. You can find more information, see our article about INCOTERMS: click here.
You can cover the risk of loss and/or damage on your property with marine insurance. It can cover the whole journey on earth, and the sea. In addition to a basic agreement, various clauses may be included to provide an optimal coverage regarding your needs.
Standard contracts cover all risks except, for example, wars and strikes. These can, however, be reinstated by including appropriate clauses.
Acts of God and acts of war
Under international law, carriers are not responsible for cases we called “acts of god”, namely unpredictable acts of nature such as lightning. Piracy, which is very common in some waters, is also considered as an act of war. If you send goods in a region where piracy is common (for example, some of the waters of Indonesia and the East coast Africa), it would be prudent to consider additional coverage .
Terrorist acts are generally excluded – coverage must be purchased for an additional clause.