🛡Freight insurance | Rates & Infos

Why would I need insurance for shipment from/to Thailand?

The terms of sale agreed upon 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 international commercial terms (here is an article that explains the incoterms) 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.

Whether you’re buying or selling goods to or from international markets, there is always a risk of delay, damage, loss, or theft during transit.

Siam Care services

To monitor and reduce the risk of loss or damage, our customers will have the chance to rely on a specialized entity. Thus, Siam Shipping provides a risk prevention service (known as Marine Loss Control Engineering).

SIAM Shipping has a strong international network that will provide you the best protection possible. We do everything we can to preserve the strengths of our customers and their commercial reputation. All this thanks to a pragmatic commercial approach and a great technical expertise.

Cargo Insurance

The loss of freight during its transit is covered by cargo insurance, even if the goods are transported by sea, air or land. It covers accidental damage and other risks, specified in each contract. As soon as one enters the international trade it is essential he ensures his cargo, especially if it carries significant quantities of goods by boat.

There are distinct types of coverage in freight. The specific benefits vary according to needs and are often customized. There are general principles that apply to the industry as a whole.

 

Different Cargo Insurances

Several types of insurance exist. They cover possible damages during transport, but it should be borne in mind that some problems may arise while the ship is in port or in transit to the warehouse or even within it.

The guarantee clauses can cover all these different problems. Or it can be done individually to provide cumulative coverage for all the locations of your assets.

The main advantage of cargo insurance is the protection of the value of your property. In case of non-subscription to this insurance, you will have to pay the entirety of the financial cost in case of damage or loss of your goods.

What risks does Cargo Insurance cover?

All Risks Cargo Insurance would cover the non-delivery of a package, this includes theft. Even in case of a total loss of the merchandise, the entire consignment would be covered, in case of accident, explosion, or combustion of the ship.

Other covered cargo risks are:

• Damage caused by dangerous weather
• Seawater or freshwater
• Inadequate storage of the shipping company
• Damage to mud and grease
• Fumigation services

 

How much does Cargo Insurance cost?

It all depends on the cargo, its origin, its destination, and the carrier. Cargo insurers have similar parameters to civilian insurance companies.

Insurance contract

The insurance contract can link the two parties during a specified period. Alternatively, it may cover items up to an agreed value.

You pay an annual package based on an initial deposit and make a final adjustment based on the declared value of your exportation/importation.

Where can I subscribe to insurance?

Your commercial insurance already in place can fully insure you for any damage to property shipped or can cover up to a certain amount. It is up to the sender to know the limits of what he wants to ensure.

Some companies choose “gap” insurance. This is the difference between a commercial insurance policy and the maximum allowed. If you already have shipping insurance on your trade policy, there is no reason to pay it twice.

Otherwise, there are many channels to get insurance:

• A specialist insurance broker
• A general insurance company
• Freight forwarder company
• Your bank
• Your Local Chamber of Commerce

How to claim insurance in case of damage?

In case of damage or loss in transit, the recipient (or buyer) should follow these guidelines:

• Take a thorough inspection of all goods and record the items damaged or missing
• Take all necessary measures to minimize or prevent further damage
• Take note of any expenses incurred before the dispute
• Keep as proof the shipping container, packaging materials, damaged goods, and shipping documents
• Contact the insurer (or dealer, if applicable) so that an injury inquiry can be organized

Then, the recipient must send a letter of complaint against the transporter – which should include:

• The company name and (if applicable) tracking number or flight number
• Sea waybill, bill of lading, or the number of the air waybill (if applicable)
• Date of arrival
• Description of the cargo
• Container numbers
• The amount claimed

At the same time, the recipient must send details of the request to the insurer (by the seller, if you use Incoterms – CIF or CIP -). It should include:

• Commercial Invoice
• Details of the insurance policy and certificate number
• Bill of lading or number of the air waybill (if applicable)
• Terms and conditions of carriage
• Correspondence with the freight forwarder for loss or damage
• Investigation report

Transport insurance for international trade

Whether you’re buying or selling goods to or from international markets, there is always a risk of delay, damage, loss or theft during transit.

How to plan before the problem happens?

We will see the various clauses in insurance contracts, details about the strategy to take, and how to contact the insurance in case of litigation.

The importance of insurance

Cargo insurance

Cargo insurance covers goods in transit by road, rail, sea, or air. In its simplest form, it provides coverage against accidental damage and other risks. The “global risk” covers a range of accidents specified in the contract (e.g. Damage during loading or negligence).

The cost of insurance and under what circumstances you receive compensation will depend on:

• The value of goods in transit
• If the trip is domestic or international

I do not want insurance, what could be the consequence?

Many events can occur during shipment that could damage your goods without having purchased insurance.

Terms and insurance functions

When you subscribe to an insurance broker or insurance directly, it is important to keep in mind some basic notions about the scope of service and support.

Compensation agreement

This is the amount of compensation agreed upon by you and your insurer if your goods are lost or damaged.

Duty of good faith

It means that you must provide all relevant information about your shipment. The insurer needs this information to evaluate the price of insurance and coverage.

They must inform you of any exclusion clause in their policy – the circumstances in which you will not receive compensation – so always read carefully the terms and conditions of the contract.

Obligation to act as uninsured

An insurance agreement does not mean you can neglect on your side “basic” care regarding packing or loading. You must act to minimize the risk of problems.

What can you do:

• Ensure that products are safely packaged
• Certify the proper functioning of tools, machinery, or transportation
• Demonstrate a rational mind with drivers and other actors in the chain
• Ensure that the buyer of the goods provides information on any loss or damaged property in an abbreviated time

Specific vocabulary

There are some notions you need to be familiar with before subscribing to insurance. These few definitions should help you.

Compensation agreement: This is the amount of compensation agreed upon by you and your insurer if your goods are lost or damaged.

Duty of good faith: It means that you must provide all relevant information about your shipment. The insurer needs this information to evaluate the price of insurance and coverage.

Acts of God: “Acts of god” are unpredictable acts of nature, such as lightning. They are risks that exist independently of human error or machines.

Acts of war: It refers to piracy, which is very common in some waters. If you send goods to a region where piracy is common (for example, some of the waters of Indonesia and the East Coast of Africa), it would be prudent to consider additional coverage.

Piracy:  it is very common in some waters, and is also considered an act of war. If you send goods to a region where piracy is common (for example, some of the waters of Indonesia and the East Coast of Africa), it would be prudent to consider additional coverage.

Conclusion

We strongly recommend to our customers to ensure all shipments, as we never know. SIAM shipping minimizes the risk using processes like packing or special loading methods, but we do prefer to get insurance to ship with peace of mind.