When you’re considering importing or exporting goods, it’s important to factor in the potential risks involved in the process. One of the most important steps in protecting your business against those risks is purchasing import and export insurance. But what does that insurance cover, and how can you be sure you’re getting the best protection for your money? This article will answer some common questions about import and export insurance, so you can make an informed decision about whether it’s right for your business.
What is Import & Export Insurance?
Import and Export Insurance protects against many risks associated with goods that are transported from one country to another. These include fires, explosions, or storms that may occur along the transit route as well as hazards beyond reasonable control like leaks in cargo containers which could lead to water damage on your expensive products waiting for export back home.
Not only does this type of insurance cover water transport but also transport along road or rail, as long as goods are moving from one country to another.
Who is responsible for insuring goods in transit?
When shipping goods, it’s important to determine who is responsible for them in transit. One of the most critical items determined by your insurance coverage terms of sale is when each party involved becomes financially liable if something happens with or during shipping. Make sure that this responsibility is clearly written into any contracts you sign so there aren’t disputes later down the line.
When should you purchase Ocean Cargo Insurance?
Ocean Cargo Insurance is a flexible policy that covers goods in the ordinary course of transit anywhere in the world. If your company is responsible for insuring goods from your supplier’s warehouse until they arrive at your facility or vice versa, you must consider Ocean Cargo Insurance.
An Ocean Cargo Insurance policy covers goods shipped by air, land, and sea from warehouse to warehouse. Your policy premium will be determined by several factors. These include what type of goods you are shipping, where the goods are being shipped from, and additional optional coverages.
It is important to determine the insured value of goods in the terms of sale. Goods could be insured by the cost of goods, insurance, and freight (CIF) plus an agreed percentage. They may also be insured by the buyer’s selling price.
However, Ocean Cargo Insurance doesn’t cover everything. It excludes risks like unexplained loss/shortage, improper packaging, and inherent damage due to the nature of the goods. That’s why it’s important to meet with an insurance service that can ensure you are covered against many different risks
Does your company also need Foreign Liability Insurance?
If you are shipping goods across foreign jurisdictions, it is important to consider Foreign Liability Insurance. General Liability policies don’t cover lawsuits that arise in foreign jurisdictions, even though you can still be held responsible if the goods you supply cause bodily harm or property damage anywhere in the world.
Foreign Liability Insurance is essentially the same as domestic liability coverage. However, it is necessary because it protects your business from lawsuits outside of the U.S., where domestic policies will not.
Your import-export business is unique. It’s crucial to partner with an insurance service that can understand your specific import and export situation and ensure that you’re covered.
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At Coughlin Insurance Services, we believe our customers should be valued and taken care of. We aim to provide quality service and meet the needs of our clients by providing businesses, including those in the food industry, with the insurance they need to protect their assets. If you’re a business looking for insurance, don’t hesitate to reach out for a free insurance quote today!