Cargo Insurance
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Cargo Insurance
Cargo insurance, also known as Marine Cargo Insurance, covers financial losses arising from loss or damage to your business goods in transit. It provides coverage for goods transported by sea, air, road, rail, or a combination of these modes.
Whether goods are shipped within India or across international borders, they can be exposed to risks such as accidents, theft, or natural calamities during transit.
Imagine sending a shipment worth several lakhs to a customer. If a severe storm causes the ship to sink and damages the cargo, it can lead to substantial losses. Cargo insurance helps you recover from such losses and continue your business operations.
TATA AIG offers different types of cargo insurance plans that can be customised to cover your specific business risk. Choosing the right policy depends on the types of goods being transported and the transit route.
Explore TATA AIG Marine Cargo Insurance and safeguard your business against shipment-related risks.
Quick Summary
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How Does Cargo Insurance Work?
Let us assume Pink Coir Exports is a business that regularly exports coir products to international markets.
| Purchase of Cargo Insurance | Transit of Goods | Occurrence of Loss | Claim Notification | Claim Assessment and Settlement |
|---|---|---|---|---|
| The company purchases cargo marine insurance for an invoice value of ₹5 lakh. | The shipment begins, and the policy coverage activates. | A fire breaks out on the ship during transit. Part of the cargo gets damaged, causing financial loss.l | Pink Coir Exports informs TATA AIG about the incident and submits the required documents to initiate the claim. | We assess the loss and review the claim. Once approved, compensation is paid as per the policy terms. |
Why Do You Need Cargo Insurance?
- To Cover Increasing Risk Exposure - India’s major ports handled 855 million tonnes of cargo in FY 2024-25. It is a 4.3% increase over the previous year. As cargo volumes increase, the exposure to transit-related risks like theft and damage also increases.
- Because Cargo Losses can be Massive - A businessman in Maharashtra shipped veterinary raw materials to Dehradun. During transit, goods worth around ₹45 lakh were stolen and had to be replaced. It resulted in a significant financial loss.
- For Legal Compliance - In certain businesses and shipping agreements, marine cargo insurance coverage may be mandatory. Failure to meet this legal requirement could lead to disputes and penalties.
Types of Cargo Insurance Policies
Cargo insurance policies are available for both inland and international transit. Depending on your business requirements and frequency of shipments, you can choose from the following types of cargo policy insurance plans.
- Specific Voyage Policy
It covers a single shipment from the source to the destination.
Ideal for: Businesses that engage in occasional shipments.
Example: A small textile manufacturer in Delhi imports machinery from Germany for setting up their manufacturing plant or production line.
- Open Policy
It covers multiple shipments within a specific time period.
Ideal for: Businesses with frequent or ongoing shipments.
Example: A textile manufacturer in Surat exports fabric to different countries depending on the orders received.
- Annual Open Policy
It covers multiple shipments within a year.
Ideal for: Businesses that engage in bulk shipments throughout the year.
Example: A multi-brand retail store that regularly distributes products from multiple places across India.
What’s Covered and Not Covered Under TATA AIG Cargo Insurance?
- Marine cargo insurance coverage is based on the Inland Transit Clause (ITC) for domestic transit and the Institute Cargo Clause (ICC) for international shipping.
Here are some of the common inclusions and exclusions. You can enhance the coverage by including additional clauses available under marine insurance plans.
| Inclusions | Exclusions |
|---|---|
|
Marine cargo insurance covers damage or loss to cargo arising from the following transit-related incidents:
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The marine cargo insurance policy does not cover loss or damage to cargo due to the following:
|
Please note: These are some of the standard inclusions and exclusions. The actual coverage can differ based on the nature of the cargo and policy conditions. Kindly refer to the policy document or contact us for clarification.
Benefits of Buying Cargo Insurance Policy
| Provides Financial Security | Enhances Business Credibility |
|---|---|
| If your goods are lost or damaged during transit, cargo insurance steps in to cover the financial loss. This means you don’t have to bear the entire financial burden on your own. | A cargo insurance policy shows your commitment to responsible business practices. It can help protect customer relationships by managing the financial impact. |
| Offers Comprehensive Coverage | Provides Cost-effective Protection |
| Cargo insurance can cover physical loss or damage to cargo caused by a broad range of risks like fire, collisions, and theft. | The premium for cargo insurance is often reasonable compared to the potential financial losses arising from cargo incidents. It's an affordable way to protect your business. |
| Covers all Transport Modes | Offers Customisable Plans |
| Whether the transportation is sea, air, rail, road, or a combination of these modes, your cargo can be protected during transit, including loading and unloading. | You can compare the different marine cargo policy options available and choose the coverage that best suits your business requirements and shipping frequency. |
How to Buy Cargo Insurance Online From TATA AIG?
| Open the Calculator | Enter the Required Details | Receive a Call Back |
|---|---|---|
| Scroll to the top of this page and access the Marine Cargo Insurance calculator. | Provide details such as the Nature of Goods, Type of Voyage, Mode of Conveyance, and Invoice Value to proceed and click on ‘Get Plan’. | Our representative will contact you. Keep important documents like the invoice, bill of lading, and shipping details handy. |
How Much Does Cargo Insurance Cost and How is it Calculated?
Marine cargo insurance is calculated mainly based on the following key factors:
- Nature of goods such as automobile spare parts, box containers, crude oil, dry fruits, electronics, fragile items, etc.
- Type of voyage, whether import, export, or domestic.
- Mode of conveyance, which depends on the type of voyage. It can be road, rail, or air for domestic transport and a combination of sea or air and rail or road for import and export.
- Invoice value of the cargo being transported.
The premium is calculated based on a certain rate applied to the insured value. The rate depends on the level of risk and the nature of the cargo.
For example, if the rate is 2% of an insured value of ₹5 lakh, the premium will be ₹6,000.
To get an exact premium quote, you can use the calculator at the top of this page. Just enter the required details, and our representative will get in touch with you with the details.
Cargo Insurance Claim Process - Step-by-Step
- Notify TATA AIG - Inform us about the loss or damage as soon as possible. You can contact our 24x7 customer support team at 022-6489-8282 or register online.
- Take Steps to Minimise Loss - Take all responsible measures to reduce further damage.
- Survey and Assessment - A surveyor will assess the loss and prepare a survey report. You can contact us for further assistance with the survey process.
- Submit Documents - Submit the required supporting documents. Please refer to the list of documents required in the next section.
- Claim Review and Settlement - We will review the documents and settle the claim upon approval.
Documents Required to File a Cargo Insurance Claim
- Original Marine Insurance Policy or Certificate of Marine Insurance
- Shipping Invoices
- Packing List
- Original Bill of Lading
- Survey Report and other supporting documents showing the loss or damage
- Landing Remarks, if applicable
- Copies of any communication exchanged with carriers, transporters or other parties regarding their liability for the loss or damage.
Please note: Additional documents may be requested based on the nature of loss or damage.
Why Choose TATA AIG for Cargo Insurance?
| Buy Directly | Covers a Wide Range of Goods |
|---|---|
| You can explore business insurance and buy marine insurance online directly from us. Our experts can help you understand the policy and decide the coverage required. | From automobile spare parts, chemicals in bulk, and medical equipment to crude oil, electronics, and precious metals, TATA AIG covers a diverse array of goods. |
| Dedicated Customer Support | Seamless Claim Process |
| Call our customer support team at 022-6489-8282 anytime for assistance with your policy or claim-related queries. | From the time you inform us of the claim, we assist you at every step to help ensure a smooth claims experience. |
| Global Survey Network | Brand Expertise |
| Our survey representatives are available across various ports of discharge and destinations worldwide to assess the loss. | With over 25 years of experience, TATA AIG offers reliable insurance solutions backed by strong expertise. |
Disclaimer / TnC
Your policy is subjected to terms and conditions & inclusions and exclusions mentioned in your policy wording. Please go through the documents carefully.
Related Articles
Frequently Asked Questions
Policy
1. Who pays for cargo insurance?
Cargo insurance is purchased by the business or the party that bears the transit risk. It is decided based on the agreement between the buyer and seller or the importer and exporter. It can also be purchased by the logistics provider on their behalf.
2. Is cargo insurance mandatory?
Cargo insurance is not always mandatory. The requirement depends on the shipping contract and any applicable country-specific regulations. However, it is highly recommended, as it can help protect businesses from significant financial losses if the cargo is lost or damaged during transit.
3. What does marine cargo insurance provide cover for?
Cargo insurance covers the loss or damage to goods in transit. If the goods are lost or damaged during transit, it helps the cargo owner cover the financial losses.
4. How much coverage do I need under cargo insurance?
Cargo insurance coverage should be decided based on the nature of goods, risks involved, and the invoice value. You can contact our customer support team to do this analysis for you and help determine the right coverage for adequate protection.
5. Why should I buy cargo insurance directly rather than through an agent?
Buying cargo insurance directly can offer greater transparency. You can understand the policy terms and conditions directly from our insurance experts.
It may also help you avoid intermediary charges. When you buy directly, you can receive guidance and support without any additional agent-related costs.
6. How much is 7,50,000 cargo insurance?
The premium depends on various factors, such as the nature of goods, mode of transport, and invoice value. You can use our cargo insurance calculator to get the premium estimate from our representatives.
8. Are there specific types of cargo that cargo insurance doesn't cover?
There can be certain types of cargo that may not be covered under the policy. You can click on the ‘Nature of Goods’ option in the calculator at the top of this page to find the goods covered under the TATA AIG Marine Cargo Policy.
11. Freight insurance vs cargo insurance – what is the difference?
Cargo insurance and freight insurance differ based on the type of risk covered.
Cargo insurance protects the goods being transported. If the goods are lost or damaged during transit, the policy helps cover the financial loss for the cargo owner.
On the other hand, freight insurance or freight cargo insurance protects the carrier or the logistics provider. It covers their liability if the goods are lost or damaged while in their custody.
13. Who can buy cargo insurance?
Cargo insurance can be purchased by importers and exporters, retailers, logistics companies, manufacturers, e-commerce businesses. traders and wholesalers.
14. Does cargo insurance cover other modes of transport apart from sea?
Yes, it covers other modes of transportation, including land, air, and rail. It also covers the combination of sea and rail or road and air and rail or road.
15. What is the policy period for cargo insurance?
Marine cargo insurance can be purchased for a single shipment, for multiple shipments during a specific period, or as an annual policy covering multiple shipments throughout the year.
16. What are the factors to consider while buying cargo insurance coverage?
Here are some of the key factors that you can consider before buying cargo insurance:
- Nature of the goods and the risks involved
- Mode of transport, whether sea, land, air, or rail or a combination of them
- Destination
- Transit route and risks involved
- Value of shipment
- Frequency of shipments
- Policy terms and conditions
- Claims procedure
General
7. What are the types of cargo?
There are different types of cargo, including containers, electrical and electronic equipment, fragile items, hazardous chemicals, and non-refrigerated edible items.
9. What is CFR?
CFR stands for Cost and Freight. It is an Incoterm that means the seller is responsible for paying the cost of the goods and freight charges to transport them to the destination port. However, the buyer will be responsible for arranging the insurance.
10. What steps should be taken in the event of a cargo loss or damage?
In case of a loss or damage, promptly notify TATA AIG, take steps to prevent the loss, and gather the required documents. A surveyor will be arranged to assess the loss. Based on the survey report and your supporting documents, the claim will be processed.
12. What is a bill of lading?
It is an official document issued by the carrier or the shipping company when they receive the goods for transit. It serves as a record of the shipment and consists of details such as the nature of cargo, invoice value, and destination.
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