Ocean marine insurance is insurance used to protect cargo, vessels and other items while they are being transported across the ocean. Both the vessel owner and the owner of the cargo are able to benefit from this type of insurance. Ocean marine insurance is not limited to ships, but can also cover items traveling by air and land as well. Since the cargo is being moved through international territories, this insurance is not regulated by any particularcountries.
There are different types of dangers that cargo may face when being transported from one country to another. Goods can be damaged while they are being loaded on or off the vessel. In addition, they can be broken en-route. People, including passengers and staff, can be injured, and the vessel itself can also be damaged. To protect against this, the vessel owner or the owner of the cargo can get different types of ocean marine insurance to compensate him in case of these damages.
Many types of ocean marine insurance exist: hull insurance, cargo insurance, and protection and indemnity (P&I) insurance. Each of these types of insurance covers something different. Hull insurance covers the vessel and machinery if they get damaged. Many times the coverage will include coverage for damage caused by stranding, sinking, fire, and collision. The insurance can be written for an individual voyage or can be written to cover a period of time.
Cargo insurance is used to protect the actual cargo that is being shipped. This type of ocean marine insurance can be either specific — covering certain damage — or all risk — covering a variety of incidences. Cargo insurance can also be special or open-ended. Special insurance is bought on a transaction to transaction basis. In contrast, open-ended insurance covers the cargo from where it is picked up to where it is going and is the most common type.
In order to protect the vessel’s owners against liability, protection and indemnity insurance can be bought. Protection and indemnity insurance is a kind of ocean marine insurance that covers liability due to damage to the cargo, death and injury to people, damage to piers, underwater cables, and other such items. Ocean marine insurers can also offer policies to cover pleasure crafts. This type of insurance can be referred to as yacht policies. Yacht policies from ocean marine insurers are usually used to cover larger vessels, while smaller vessels are mainly covered by inland marine insurers.
Various policies are also available to cover miscellaneous items associated with shipping. Some of these items are piers, docks, marinas, shipyards, and repair facilities. In addition, there are some incidences that are usually excluded for coverage under ocean marine insurance policies. Examples of such incidences are strikes, riots, acts of war, and confiscation. It is possible, however, to have these things covered by endorsements.