Marine Annual Sales Turnover Insurance
Marine Annual Sales Turnover Insurance calculates premiums based on sales turnover, covering imports, purchases, and transfers, unlike open policies.
- Annual Coverage
- Flexible and Comprehensive
- Cost-Effective
What is Marine Annual Sales Turn Over Insurance?
Marine Annual Sales Turnover Insurance is a form of marine insurance that has gained popularity in India. It differs from an open policy mainly in how the premium is calculated and charged. The ATOP is based on the sales turnover, and premium rates are applied to the sales turnover, which includes various underlying transits such as imports, domestic purchases, and inter-depot transfers. The logic is that the cost of raw materials and other components are captured within the sales turnover of the finished goods.
Rating Methodology of Marine Annual Sales Turnover Insurance
The premium is charged on the audited gross sales figure from the previous year, subject to adjustment based on actual figures when available.
The policy covers all transits of raw materials and finished goods, with a single premium rate applied to the sales turnover.
The premium rate is a weighted average of various rates for different transit exposures.
If the turnover does not include certain transactions, such as cross-voyages or sales of raw materials, these must be separately declared and covered.
Rating Methodology of Marine Annual Sales Turnover Insurance
The premium is charged on the audited gross sales figure from the previous year, subject to adjustment based on actual figures when available.
The policy covers all transits of raw materials and finished goods, with a single premium rate applied to the sales turnover.
The premium rate is a weighted average of various rates for different transit exposures.
If the turnover does not include certain transactions, such as cross-voyages or sales of raw materials, these must be separately declared and covered.
Key Features of Marine Annual Sales Turn Over Insurance
Annual Coverage
The policy covers all shipments during the policy period, whether they are by sea, air, road, or rail. This makes it ideal for businesses with frequent or regular shipments.
Sales Turnover Basis
The premium is based on the estimated annual sales turnover of the goods being shipped, rather than the individual value of each shipment. This allows for easier management and ensures that all shipments are covered without the need to declare each one separately.
Flexible and Comprehensive
Marine Annual Sales Turnover Insurance provides broad coverage against risks such as damage, theft, and loss during transit. The policy can be customized to include specific risks or regions based on the business’s needs.
Cost-Effective
By covering all shipments under a single policy, businesses can often achieve cost savings compared to purchasing individual policies for each shipment. The premium is typically adjusted at the end of the policy period based on actual turnover.
Simplified Administration
With this insurance, businesses do not need to worry about obtaining separate policies for each shipment. This reduces administrative burden and simplifies the process of managing marine insurance.
Who Should Consider Marine Annual Sales Turnover Insurance?
Have a high volume of shipments throughout the year.
Need consistent and reliable coverage for their goods in transit.
Want to simplify the management of their marine insurance needs
Prefer a flexible policy that can adjust to changes in shipment volumes or routes.
Who Should Consider Marine Annual Sales Turnover Insurance?
Have a high volume of shipments throughout the year.
Need consistent and reliable coverage for their goods in transit.
Want to simplify the management of their marine insurance needs
Prefer a flexible policy that can adjust to changes in shipment volumes or routes.
Difference between Marine Specific Transit, Marine Open Declaration & Marine Annual Sales Turn Over Insurance
| Feature | Marine Specific Voyage Insurance | Marine Open Declaration Policy | Marine Annual Sales Turnover Policy |
|---|---|---|---|
| Coverage Scope | Covers a single, specific voyage or transit. | Covers multiple shipments under a single policy up to a declared value. | Covers all shipments during the policy period based on annual turnover. |
| Policy Period | Valid only for the duration of a specific voyage. | Typically valid for one year, but only for declared shipments. | Typically valid for one year, covering all shipments within that period. |
| Flexibility | Limited flexibility; covers only the declared voyage. | Flexible; allows declaration of shipments as they occur. | Highly flexible; covers all shipments without the need for individual declarations. |
| Premium Payment | Single premium payment for the specific voyage. | Premiums are adjusted based on the value of shipments declared. | Premiums are calculated based on the estimated annual sales turnover. |
| Documentation | Requires individual policy issuance for each voyage. | Requires declarations for each shipment, usually on a monthly basis. | Minimal documentation; no need for individual shipment declarations. |
| Best Suited For | Businesses with infrequent or irregular shipments. | Businesses with regular shipments but varying volumes. | Businesses with high and consistent shipment volumes throughout the year. |
Difference between Marine Specific Transit, Marine Open Declaration & Marine Annual Sales Turn Over Insurance
| Feature | Marine Specific Voyage Insurance | Marine Open Declaration Policy | Marine Annual Sales Turnover Policy |
|---|---|---|---|
| Coverage Scope | Covers a single, specific voyage or transit. | Covers multiple shipments under a single policy up to a declared value. | Covers all shipments during the policy period based on annual turnover. |
| Policy Period | Valid only for the duration of a specific voyage. | Typically valid for one year, but only for declared shipments. | Typically valid for one year, covering all shipments within that period. |
| Flexibility | Limited flexibility; covers only the declared voyage. | Flexible; allows declaration of shipments as they occur. | Highly flexible; covers all shipments without the need for individual declarations. |
| Premium Payment | Single premium payment for the specific voyage. | Premiums are adjusted based on the value of shipments declared. | Premiums are calculated based on the estimated annual sales turnover. |
| Documentation | Requires individual policy issuance for each voyage. | Requires declarations for each shipment, usually on a monthly basis. | Minimal documentation; no need for individual shipment declarations. |
| Best Suited For | Businesses with infrequent or irregular shipments. | Businesses with regular shipments but varying volumes. | Businesses with high and consistent shipment volumes throughout the year. |
| Risk Management | Limited to the specific voyage covered. | Provides continuous coverage but requires accurate declaration. | Comprehensive coverage for the entire year without the need for individual shipment oversight. |
| Cost Efficiency | Potentially higher cost per shipment due to individual policies. | Cost-effective for regular shippers with varying shipment sizes. | Cost-effective for businesses with consistent shipment volumes and values. |
| Claim Process | Claims are processed based on the specific policy for the voyage. | Claims are processed for declared shipments under the policy. | Claims are processed under the annual policy, covering all shipments. |
| Customization | Customizable for specific routes or cargo types. | Customizable for declared shipments but within the overall policy limits. | Less customization; covers all shipments under a broad policy framework. |
Who Should Buy a Marine Annual Sales Turn Over Insurance?
Importers and Exporters
Businesses engaged in international trade need Marine Annual Sales Turn Over Insuranceto protect their goods during overseas transit, covering potential risks across borders.
Manufacturers
Companies that produce goods and ship them to distributors or customers, both domestically and internationally, require insurance to safeguard their products against damage or loss during transportation.
Logistics and Freight Forwarders
Companies responsible for organizing and handling the shipping of goods need Marine Annual Sales Turn Over Insuranceto ensure that their clients' goods are protected throughout the journey.
Retailers
Retailers that import products for sale often need Marine Annual Sales Turn Over Insuranceto cover the goods from the point of origin to their final destination, protecting their inventory and investment.
E-commerce Businesses
Online retailers who ship products globally or domestically benefit from Marine Annual Sales Turn Over Insuranceto protect against the risks associated with transporting goods to customers.
Wholesalers and Distributors
Businesses that purchase goods in bulk and distribute them to various locations need insurance to cover the transit risks involved in moving large quantities of products.
Project Owners and Contractors:
Those involved in large-scale projects, such as construction or infrastructure development, often need Marine Annual Sales Turn Over Insuranceto cover the transportation of materials and equipment, ensuring their projects stay on schedule and within budget.
How Does Marine Annual Sales Turnover Insurance Function?
- Annual Agreement: The insurer and the business agree on a policy that covers all shipments within a 12-month period. The coverage is based on the business’s estimated annual sales turnover, which includes the total value of goods expected to be shipped during that year.
- Coverage Scope: The policy covers shipments by various modes of transport, including sea, air, road, and rail, and can be customized to include specific routes, regions, or risks relevant to the business.
- Initial Estimate: At the start of the policy period, the business provides an estimate of its annual sales turnover. This estimate forms the basis for the initial premium calculation.
- Adjustment: The estimated turnover is reviewed and adjusted at the end of the policy period to reflect the actual sales turnover. This adjustment ensures that the premium paid corresponds accurately to the volume of goods shipped.
- Based on Turnover: The premium is calculated based on the estimated annual sales turnover. This approach allows for a more predictable and often lower cost compared to insuring each shipment separately.
- End-of-Year Adjustment: After the policy period ends, the actual turnover is assessed. If the actual turnover exceeds the estimate, the business may need to pay an additional premium. Conversely, if the turnover is lower than estimated, the business may receive a refund or credit.
- Automatic Coverage: All shipments made during the policy period are automatically covered. There is no need for the business to declare each shipment individually, simplifying the insurance process.
- Comprehensive Protection: The policy typically covers a wide range of risks, including damage, theft, loss, and other perils during transit. Businesses can also opt for additional coverage for specific risks like war, strikes, or high-value goods.
- Filing a Claim: In the event of a loss or damage, the business files a claim with the insurer. The process is straightforward and typically requires documentation such as bills of lading, invoices, and evidence of the loss or damage.
- Claim Settlement: Once the claim is verified, the insurer compensates the business based on the terms of the policy and the value of the lost or damaged goods. The process is designed to be efficient, ensuring that businesses can quickly recover from losses.
- Policy Review: At the end of the policy period, the business and insurer review the total shipments and adjust the premium if necessary. This review ensures that the policy remains aligned with the business’s shipping activity.
- Renewal: The policy can be renewed for another year, with adjustments made to the estimated turnover and coverage terms based on the past year’s experience and any changes in the business’s operations.
- Efficiency: Businesses save time and resources by avoiding the need to manage multiple individual policies.
- Flexibility: The policy adapts to changes in the business’s shipping volume and routes throughout the year.
- Cost-Effectiveness: By covering all shipments under one policy, businesses often benefit from lower premiums and better risk management.
- Continuous Coverage: There’s no risk of shipments being left uninsured due to oversight or delays in arranging coverage.
Why should you buy Marine Annual Sales Turn Over Insurance from GoInsureIndia.com?
Expertise in Marine Insurance
Specialized Knowledge: GoInsureIndia.com has extensive experience in marine insurance, offering tailored solutions that meet the unique needs of businesses involved in regular shipping. Our expertise ensures that you get the most suitable coverage for your specific requirements.
Competitive Pricing
Cost-Effective Solutions: We provide competitive premium rates, ensuring that you receive the best value for your investment. With GoInsureIndia.com, you can optimize your insurance costs without compromising on the quality of coverage.
Comprehensive Coverage Options
Wide Range of Protection: We offer policies that cover a broad spectrum of risks associated with marine transit, including damage, theft, and loss. We also provide options to customize your policy with additional clauses tailored to your business needs.
Flexible and Convenient Policy Management
Easy Administration: Managing your Marine Annual Sales Turn Over Insurance is straightforward with GoInsureIndia.com. Our user-friendly platform allows you to declare shipments, adjust coverage, and handle all insurance-related tasks with ease, saving you time and effort.
Dedicated Relationship Manager
Personalized Support: GoInsureIndia.com provides you with a dedicated relationship manager who will be your single point of contact for all your insurance needs. This ensures personalized service and prompt assistance whenever required.
Quick and Efficient Claims Processing
Prompt Settlements: In the event of a claim, GoInsureIndia.com is known for its efficient claims processing, ensuring that you receive compensation quickly and without unnecessary delays. Our streamlined process minimizes disruption to your business operations.
Types of Coverage under Marine Annual Sales Turn Over Insurance
| Clauses | Coverage Type | Jurisdiction | Exclusions | Ideal For | Typical Perils Covered |
|---|---|---|---|---|---|
| ICC-A (International Cargo Clauses A) | All Risks | International Shipments | Inherent vice, delay, inadequate packaging | High-value goods requiring broad protection | All perils except those specifically excluded |
| ICC-B (International Cargo Clauses B) | Named Perils | International Shipments | Inherent vice, delay, inadequate packaging | Goods exposed to moderate risks | Fire, explosion, theft, earthquake, etc. |
| ICC-C (International Cargo Clauses C) | Basic Named Perils | International Shipments | Inherent vice, delay, inadequate packaging | Basic goods with minimal risk | Fire, explosion, vessel sinking, collision, etc. |
| ITC-A (Inland Transit Clauses A) | All Risks | Inland Transit | Inherent vice, delay, inadequate packaging | High-value goods during inland transit | All perils except those specifically excluded |
| ITC-B (Inland Transit Clauses B) | Named Perils | Inland Transit | Inherent vice, delay, inadequate packaging | Goods exposed to moderate risks during inland transit | Fire, explosion, theft, earthquake, etc. |
| ITC-C (Inland Transit Clauses C) | Basic Named Perils | Inland Transit | Inherent vice, delay, inadequate packaging | Basic goods with minimal risks during inland transit | Fire, explosion, overturning, collision, etc. |
Types of Coverage under Marine Annual Sales Turn Over Insurance
| Clauses | Coverage Type | Jurisdiction | Exclusions | Ideal For | Typical Perils Covered |
|---|---|---|---|---|---|
| ICC-A (International Cargo Clauses A) | All Risks | International Shipments | Inherent vice, delay, inadequate packaging | High-value goods requiring broad protection | All perils except those specifically excluded |
| ICC-B (International Cargo Clauses B) | Named Perils | International Shipments | Inherent vice, delay, inadequate packaging | Goods exposed to moderate risks | Fire, explosion, theft, earthquake, etc. |
| ICC-C (International Cargo Clauses C) | Basic Named Perils | International Shipments | Inherent vice, delay, inadequate packaging | Basic goods with minimal risk | Fire, explosion, vessel sinking, collision, etc. |
| ITC-A (Inland Transit Clauses A) | All Risks | Inland Transit | Inherent vice, delay, inadequate packaging | High-value goods during inland transit | All perils except those specifically excluded |
| ITC-B (Inland Transit Clauses B) | Named Perils | Inland Transit | Inherent vice, delay, inadequate packaging | Goods exposed to moderate risks during inland transit | Fire, explosion, theft, earthquake, etc. |
| ITC-C (Inland Transit Clauses C) | Basic Named Perils | Inland Transit | Inherent vice, delay, inadequate packaging | Basic goods with minimal risks during inland transit | Fire, explosion, overturning, collision, etc. |
| Institute Cargo Clauses (Air) | All Risks | Air Transit | War, inherent vice, delay | High-value goods transported by air | All risks except those specifically excluded |
| Institute War Clauses (Cargo) | War Risks | International Shipments | General exclusions apply | Goods in war zones or high-risk areas | War, civil war, revolution, rebellion, etc. |
| Institute Strikes Clauses (Cargo) | Strikes, Riots, Civil Commotions | International Shipments | General exclusions apply | Goods in areas prone to strikes or civil unrest | Strikes, riots, civil commotions, etc. |
| Institute Theft, Pilferage, and Non-Delivery (TPND) Clauses | Theft, Pilferage, Non-Delivery | International and Domestic Shipments | General exclusions apply | High-value or easily marketable goods | Theft, pilferage, non-delivery |
| Institute Frozen Food Clauses (A) | All Risks for Frozen Food | Frozen Food Shipments | Inherent vice, temperature control failure (unless caused by insured peril) | Frozen food requiring maximum protection | All risks except those specifically excluded |
| Institute Frozen Food Clauses (B) | Named Perils for Frozen Food | Frozen Food Shipments | Inherent vice, temperature control failure | Frozen food with limited risk exposure | Fire, explosion, collision |
| Institute Container Clauses | All Risks for Containers | Containerized Cargo | General exclusions apply | Shipments using containers | All risks except those specifically excluded |
| Institute Cargo Clauses (Disbursements) | Disbursements | Cargo Disbursements | General exclusions apply | Shipments with significant disbursements | Disbursements due to insured risks |
Non-Institute Clause/Coverage
War and Strikes Coverage
- Coverage: Covers risks related to war, strikes, riots, and civil commotions, which are typically excluded from standard policies.
- Ideal For: Shipments to or through high-risk regions.
Frozen Food Coverage
- Coverage: Designed for temperature-sensitive goods, covering risks related to temperature control failures.
- Ideal For: Businesses shipping perishable goods like frozen food.
High-Value Goods Coverage
- Coverage: Provides enhanced protection for valuable items such as electronics, jewelry, or machinery.
- Ideal For: Businesses transporting high-value goods.
On-Deck Cargo Coverage
- Coverage: Covers goods stowed on the deck of a vessel, which are more exposed to risks.
- Ideal For: Oversized or heavy goods that cannot be stored below deck.
General Average Coverage
- Coverage: Ensures that all parties in a sea voyage share the loss if part of the cargo is sacrificed to save the vessel, compensating the insured for their share of the loss.
- Ideal For: Shipments exposed to significant maritime risks.
Pair and Set Clause
- Coverage: Provides compensation if one item in a pair or set is damaged, considering the reduced value of the remaining items.
- Ideal For: Goods that are part of a matched pair or set, such as luxury items or machinery components.
Debris Removal Clause
- Coverage: Covers the costs associated with removing debris after an insured event, ensuring the insured is not burdened with these additional expenses.
- Ideal For: Shipments involving potentially hazardous or bulky cargo.
Concealed Damage Clause
- Coverage: Covers damage that is not immediately apparent upon delivery but is discovered later, typically within a specified period.
- Ideal For: Goods susceptible to hidden damage, such as electronics or machinery.
Sue and Labor Clause
- Coverage: Requires the insured to take reasonable steps to prevent or minimize a loss, with the insurer reimbursing the costs of these actions.
- Ideal For: Shipments where the insured can intervene to mitigate potential losses.
Institute Replacement Clause
- Coverage: Provides coverage for the cost of replacing damaged or lost items with new ones, rather than just compensating for the item’s depreciated value.
- Ideal For: High-value goods where replacement with new items is crucial, such as industrial equipment or high-end consumer goods.
Waiver of Subrogation Clause
- Coverage: Prevents the insurer from seeking reimbursement from third parties who may be responsible for the loss.
- Ideal For: Shipments involving long-term partnerships or contracts where maintaining good relationships is key.
Accumulation Clause/200% Accumulation Clause
- Coverage: Extends coverage beyond standard limits if goods unexpectedly accumulate during transit due to delays or accidents, with the insurer’s liability increasing up to 200% of the original conveyance limit.
- Ideal For: High-value shipments where unforeseen accumulations could occur, particularly at transshipment ports or during delays.
Aircraft Clause
- Coverage: Ensures that terms like ‘ship,’ ‘vessel,’ and ‘seaworthiness’ in the policy also apply to air transport.
- Ideal For: Shipments involving both sea and air transport or goods transported entirely by air that need specific coverage.
Airfreight Replacement Clause
- Coverage: Covers the costs of airfreighting damaged goods or replacement parts for repair, even if the original shipment was by sea.
- Ideal For: High-value goods requiring timely repairs or replacements.
Brands Clause
- Coverage: Ensures that if branded or trademarked goods are damaged, the brands or trademarks must be removed before the goods are salvaged or sold.
- Ideal For: Luxury goods, electronics, or any branded products where maintaining brand reputation is crucial.
Container Clause
- Coverage: Assumes that the container carrying the insured cargo is fit for use, with coverage ensuring integrity unless the assured is aware of any issues.
- Ideal For: High-volume shipments in containers where container integrity is crucial to avoid water damage or other issues.
Container Demurrage Charges Clause
- Coverage: Covers the costs of demurrage charges or late penalties for the late return of containers, particularly when delays are due to insurer instructions.
- Ideal For: Shipments requiring detailed inspections post-arrival.
Cutting Clause
- Coverage: Specifies that if a portion of an item like a pipe or sheet is damaged, the insurer will pay the proportionate value of the cut portion.
- Ideal For: Shipments of materials like pipes or steel, where even minor damage can render the entire piece unusable.
Deck Cargo Clause
- Coverage: Covers insured goods carried on deck under specific conditions, with limited coverage compared to under-deck cargo unless specifically extended.
- Ideal For: Oversized or heavy goods that must be stowed on deck.
Deductible Clause
- Coverage: Specifies that deductibles are generally applied to eliminate smaller claims but not to major perils or unforeseen events.
- Ideal For: Policies where significant events are covered, ensuring that deductibles do not reduce the claim payout.
Difference in Conditions Clause
- Coverage: Provides additional coverage when goods are purchased CIF or on similar terms, ensuring that the buyer is fully protected without creating double insurance.
- Ideal For: Buyers purchasing goods CIF or on similar terms, who want to ensure their insurance coverage matches their needs.
Errors and Omissions Clause
- Coverage: Ensures that the assured is not penalized for unintentional delays, omissions, or errors in reporting.
- Ideal For: Shipments where there is a risk of errors in reporting or description, particularly in complex logistics scenarios.
FOB and FAS Purchases Clause
- Coverage: Provides insurance coverage from the moment goods leave the supplier’s premises, even if purchased on FOB or FAS terms.
- Ideal For: Buyers purchasing goods FOB or FAS, ensuring that their goods are covered from the point of departure.
General Average in Full Clause
- Coverage: Ensures that for claims involving General Average contributions and salvage charges, the insured goods are covered for their full contributory value.
- Ideal For: High-value shipments where the full contributory value needs to be protected in General Average situations.
Letter of Credit Clause
- Coverage: Ensures that the insurance coverage meets the specific requirements outlined in a Letter of Credit.
- Ideal For: Shipments financed through Letters of Credit, where specific insurance terms must be met.
Loading and Unloading Clause
- Coverage: Extends coverage to include loss or damage to goods during loading and unloading operations.
- Ideal For: Shipments involving complex logistics, where goods are at risk during handling operations.
Packers Clause
- Coverage: Extends coverage to include goods in transit to a packer’s premises, while being packed, and awaiting shipment.
- Ideal For: Shipments requiring professional packing, particularly when warehouse-to-warehouse coverage does not typically include these stages.
Presentation Packing Clause
- Coverage:Covers the reasonable costs of repairing or replacing the presentation packing of goods if damaged during transit.
- Ideal For:Goods where the presentation packing is an intrinsic part of the product, such as perfumes or luxury items.
Repacking Clause
- Coverage: Covers the cost of reasonable repacking expenses if the original packing is damaged during transit.
- Ideal For: Goods intended for onward sale, where damaged packing could prevent further distribution.
Seals Clause
- Coverage: Ensures that claims for theft, pilferage, or non-delivery of a whole package will be honored even if the container’s seals appear intact.
- Ideal For: Goods intended for onward sale, where damaged packing could prevent further distribution.
Duty of Assured Clause
- Coverage: Outlines the responsibilities of the assured to minimize loss, including taking reasonable steps to protect the cargo from further damage.
- Ideal For: All shipments, as it enforces the principle that the assured must take steps to mitigate loss.
Fumigation Clause
- Coverage: Covers the costs associated with the fumigation of goods, especially when infestation is discovered during transit or upon arrival.
- Ideal For: Agricultural products, foodstuffs, or other goods susceptible to infestation.
Held Covered Clause
- Coverage: Allows coverage to continue if the insured inadvertently fails to report a change in risk, provided they notify the insurer and pay any additional premium.
- Ideal For: Cargo shipments where the nature of the goods or the voyage details may change after the insurance is arranged.
Increased Value Clause
- Coverage: Allows for additional insurance if the value of the goods increases after the policy is issued.
- Ideal For: Goods that may appreciate in value during transit or require increased coverage due to changes in market conditions.
Machinery Clause
- Coverage: Provides specific coverage for machinery items, ensuring that coverage applies even if the machinery is partially damaged.
- Ideal For: Shipments of heavy machinery or industrial equipment.
Pollution Hazard Clause
- Coverage: Provides coverage for liability arising from pollution caused by the insured cargo, including the cost of cleaning up spills and legal expenses.
- Ideal For: Shipments of chemicals, oil, or other hazardous materials that pose a significant pollution risk.
Unseaworthiness and Unfitness Exclusion Clause
- Coverage: Excludes coverage if the loss arises from the unseaworthiness of the vessel or the unfitness of the transport method, unless the assured can prove they were unaware of the condition.
- Ideal For: Situations where there’s a concern that older or less reliable vessels or transport methods may be used.
Common Exclusions under Marine Annual Sales Turn Over Insurance
Willful Misconduct
No coverage for losses due to intentional acts or negligence by the insured.
Inherent Vice
Excludes damage due to the natural characteristics of the goods, such as spoilage or corrosion.
Ordinary Leakage and Weight Loss
Normal shrinkage, evaporation, or loss in weight during transit is not covered.
Insufficient Packing
Damages due to inadequate or improper packing are excluded.
Delay
Losses solely caused by delays in transit are not covered.
Common Exclusions under Marine Annual Sales Turn Over Insurance
Willful Misconduct
No coverage for losses due to intentional acts or negligence by the insured.
Inherent Vice
Excludes damage due to the natural characteristics of the goods, such as spoilage or corrosion.
Ordinary Leakage and Weight Loss
Normal shrinkage, evaporation, or loss in weight during transit is not covered.
Insufficient Packing
Damages due to inadequate or improper packing are excluded.
Delay
Losses solely caused by delays in transit are not covered.
War and Strikes
Excludes damages from war, strikes, riots, and civil commotions, unless separately insured.
Nuclear Contamination
No coverage for damages from nuclear reactions or radioactive contamination.
Unseaworthiness
Losses due to unfit vessels or transport, if known by the insured, are excluded.
Loss of Market
Financial losses from market fluctuations or missed opportunities are not covered.
Temperature Variations
Damage from temperature or humidity changes is excluded unless specifically covered.
Customs Rejection
Losses due to goods being rejected or confiscated by customs authorities are not covered.
Insolvency of Carrier
Excludes losses if the carrier becomes insolvent and cannot complete the delivery.
Wear and Tear
Ordinary wear and tear of goods during transit is not covered.
Pollution Damage
Excludes damages due to pollution, unless caused by a covered peril.
Pre-existing Damage
Damage that existed before the start of the transit is not covered.
Common Conditions/Warranties under Marine Annual Sales Turn Over Insurance
Packing Warranty
Goods must be properly and securely packed. Poor packing can void coverage for damages.
Seaworthiness of Vessel
The vessel must be seaworthy and fit for the voyage. If unseaworthy, coverage may be void.
Legality
Shipments must comply with all laws. Illegal goods are not covered.
No Deviation Clause
The shipment must follow the agreed route. Unauthorized deviations may void coverage.
Prompt Notice of Loss
Loss or damage must be reported promptly to ensure valid claims.
Duty of Assured (Sue and Labor)
The insured must take reasonable steps to minimize losses during transit.
Proper Documentation
All required documents must be provided for a claim. Incomplete documentation can lead to claim denial.
Carrier’s Limitations
Recognize the carrier's liability limits when filing a claim, but this doesn't affect the insurer’s obligations.
Trade Sanctions Clause
Goods must not be shipped to or from sanctioned countries. Violations void coverage.
Insurable Interest
The insured must have a legal or financial interest in the goods at the time of loss.
Inco Terms
| Incoterm | Seller’s Responsibility | Buyer’s Responsibility | Insurable Interest (Seller) | Insurable Interest (Buyer) |
|---|---|---|---|---|
| EXW (Ex Works) | Minimal | Full Responsibility | None | From Pickup |
| FCA (Free Carrier) | Delivery to Carrier | Transport after Delivery to Carrier | Until Delivery to Carrier | After Delivery to Carrier |
| CPT (Carriage Paid To) | Transport to Destination | Risk After Delivery to Carrier | Until Delivery to Carrier | After Delivery to Carrier |
| CIP (Carriage and Insurance Paid To) | Transport and Insurance | Risk After Delivery to Carrier | Until Delivery to Carrier | After Delivery to Carrier |
| DAP (Delivered at Place) | Delivery to Place | Risk After Delivery at Place | Until Delivery at Place | After Delivery at Place |
| DPU (Delivered at Place Unloaded) | Delivery and Unloading | Risk After Unloading | Until Unloading | After Unloading |
Inco Terms
| Incoterm | Seller’s Responsibility | Buyer’s Responsibility | Insurable Interest (Seller) | Insurable Interest (Buyer) |
|---|---|---|---|---|
| EXW (Ex Works) | Minimal | Full Responsibility | None | From Pickup |
| FCA (Free Carrier) | Delivery to Carrier | Transport after Delivery to Carrier | Until Delivery to Carrier | After Delivery to Carrier |
| CPT (Carriage Paid To) | Transport to Destination | Risk After Delivery to Carrier | Until Delivery to Carrier | After Delivery to Carrier |
| CIP (Carriage and Insurance Paid To) | Transport and Insurance | Risk After Delivery to Carrier | Until Delivery to Carrier | After Delivery to Carrier |
| DAP (Delivered at Place) | Delivery to Place | Risk After Delivery at Place | Until Delivery at Place | After Delivery at Place |
| DPU (Delivered at Place Unloaded) | Delivery and Unloading | Risk After Unloading | Until Unloading | After Unloading |
| DDP (Delivered Duty Paid) | Full Responsibility | Minimal | Until Delivery | From Delivery |
| FAS (Free Alongside Ship) | Delivery Alongside Ship | Transport Onward | Until Alongside Ship | After Alongside Ship |
| FOB (Free on Board) | Delivery On Board | Transport Onward | Until On Board | After On Board |
| CFR (Cost and Freight) | Transport to Destination | Risk After Delivery On Board | Until On Board | After On Board |
| CIF (Cost, Insurance, and Freight) | Transport and Insurance | Risk After Delivery On Board | Until On Board | After On Board |
Tips for Using Incoterms Correctly
Ownership and Payment
Incoterms do not cover ownership transfer or payment terms/methods.
Contract of Sale
Incoterms should be expressly incorporated into the Contract of Sale.
Appropriate Term
Choose the term suited to the type of goods and transport (e.g., airfreight).
Transport Responsibility
Clarify who arranges transportation—domestic or international.
Specificity
Specify the location (Point/Port/Place) clearly.
Compatibility
Ensure the term fits with the payment system (e.g., LC) and is suitable for containerized goods.
Tips for Using Incoterms Correctly
Ownership and Payment
Incoterms do not cover ownership transfer or payment terms/methods.
Contract of Sale
Incoterms should be expressly incorporated into the Contract of Sale.
Appropriate Term
Choose the term suited to the type of goods and transport (e.g., airfreight).
Transport Responsibility
Clarify who arranges transportation—domestic or international.
Specificity
Specify the location (Point/Port/Place) clearly.
Compatibility
Ensure the term fits with the payment system (e.g., LC) and is suitable for containerized goods.
Key suggestions to make the best Marine Annual Sales Turn Over Insurance plan
- Evaluate Goods and Routes: Identify the types of goods you ship, their value, and the routes they take. This will help determine the level of coverage needed and any specific risks that should be addressed in the policy.
- Consider Historical Data: Review past incidents or claims to identify common risks associated with your shipments.
- Select Appropriate Clauses: Based on your risk assessment, choose coverage types and clauses that best fit your needs, such as All-Risks Coverage, Named Perils Coverage, or specialized clauses like War and Strikes.
- Consider Additional Coverages: Evaluate whether you need extra protection, such as for high-value goods, temperature-sensitive items, or multimodal transport.
- Accurate Declaration of Goods:Ensure that the declared value of each shipment accurately reflects its true value, including cost, insurance, and freight (CIF). This prevents under-insurance and ensures adequate compensation in case of a loss.
- Include Potential Accumulations:Consider potential accumulations at transshipment points and ensure they are covered, especially if your shipments involve high-value goods.
- Review Common Exclusions: Be aware of what is not covered under the policy, such as willful misconduct, inherent vice, or insufficient packing. Consider additional coverage or endorsements if any of these exclusions present a significant risk to your business.
- Address Gaps in Coverage: If necessary, add specific clauses or separate policies to cover risks that are excluded from standard coverage.
- Annual Policy Review: Regularly review your policy, at least annually, to ensure it still meets your business needs, especially if there have been changes in your shipping practices or the types of goods you transport.
- Adjust Coverage Limits: As your business grows or shipping volumes change, adjust your coverage limits and terms to match your current needs.
- Choose a Trusted Provider: Partner with an insurer experienced in marine insurance and with a strong reputation for claims handling and customer service.
- Leverage Expert Advice: Consult with insurance experts or brokers who can help you understand your needs and recommend the best policy options.
- Keep Accurate Records: Maintain detailed records of all shipments, declarations, and any communications with the insurer. Proper documentation is crucial in the event of a claim.
- Ensure Compliance: Make sure all shipments comply with the policy terms, including proper packing, route adherence, and timely declarations.
- Familiarize Yourself with Procedures: Know how to file a claim, including the required documentation and timelines. This ensures a smooth and timely claims process.
- Plan for Emergency Actions: Have a clear plan for what to do in case of an incident, such as notifying the insurer immediately and taking steps to mitigate further loss.
Common Pitfalls to Avoid While Planning for Marine Annual Sales Turnover Insurance
- Underestimating Annual Sales Turnover
- Pitfall: Businesses may underestimate their annual sales turnover to reduce premium costs.
- Consequence: Underestimating turnover can lead to insufficient coverage, resulting in higher out-of-pocket costs if actual shipments exceed the insured amount. It may also lead to additional premium adjustments at the end of the policy period.
- Inadequate Assessment of Shipping Risks
- Pitfall: Failing to thoroughly assess the risks associated with shipping routes, modes of transport, or specific goods being shipped.
- Consequence: This can result in a policy that doesn’t fully cover potential risks, leaving the business vulnerable to significant losses in case of an incident.
- Failing to Adjust Coverage Mid-Term
- Pitfall: Not reviewing and adjusting the policy mid-term to reflect changes in sales volumes, shipping routes, or business operations.
- Consequence: As business conditions change, the initial coverage may no longer be adequate, leading to gaps in protection or the need for costly adjustments at the end of the policy period.
- Overlooking Policy Exclusions and Limitations
- Pitfall: Not paying attention to the specific exclusions and limitations outlined in the policy.
- Consequence: Businesses may assume they are fully covered when, in fact, certain risks (like war, strikes, or inherent vice) are not included, leading to unexpected denials of claims.
- Inadequate Documentation and Record-Keeping
- Pitfall: Poor documentation of shipments and related transactions, leading to difficulties in making accurate declarations or filing claims.
- Consequence: Inadequate records can complicate the claims process, delay settlements, or even result in claim denials.
- Over-Declaration of Turnover
- Pitfall: Overestimating sales turnover in an attempt to secure more coverage than necessary.
- Consequence: This leads to higher premium costs and potential financial strain without providing additional benefit, as refunds for overpaid premiums may be limited or nonexistent.
- Not Considering the Impact of Multiple Modes of Transport
- Pitfall: Failing to account for the use of multiple transport modes (e.g., sea, air, road) in the policy.
- Consequence: If the policy is not structured to cover all modes of transport used, certain legs of the journey might be uninsured, leading to gaps in coverage.
- Delaying Claims Reporting
- Pitfall: Delaying the reporting of incidents or claims, thinking it can be handled later.
- Consequence: Delayed reporting can result in complications or outright denial of the claim, as many policies have strict time frames within which claims must be filed.
FAQs on Marine Annual Sales Turnover Insurance
What is Marine Annual Sales Turnover Insurance?
Marine Annual Sales Turnover Insurance is a comprehensive policy that covers all shipments made by a business within a specified year, based on the estimated annual sales turnover.
How is the premium for Marine Annual Sales Turnover Insurance calculated?
The premium is calculated based on the estimated annual sales turnover, which includes the total value of goods expected to be shipped during the policy period.
What types of goods can be covered under Marine Annual Sales Turnover Insurance?
The policy can cover a wide range of goods, including raw materials, finished products, high-value items, and perishable goods, depending on the specific needs of the business.
Does Marine Annual Sales Turnover Insurance cover multiple modes of transport?
Yes, this insurance covers goods transported by sea, air, road, and rail, providing comprehensive protection regardless of the mode of transport.
How does Marine Annual Sales Turnover Insurance differ from traditional marine insurance?
Unlike traditional policies that require separate coverage for each shipment, Marine Annual Sales Turnover Insurance covers all shipments within a year under a single policy, simplifying insurance management.
Can I adjust my Marine Annual Sales Turnover Insurance coverage mid-term?
Yes, the policy can be adjusted mid-term to reflect changes in sales volumes, shipping routes, or other business operations.
What happens if my actual sales turnover exceeds the estimated amount?
If the actual sales turnover exceeds the estimate, the premium may be adjusted at the end of the policy period to reflect the increased turnover.
Is there a penalty for underestimating or overestimating sales turnover?
Underestimating turnover may result in additional premiums at the end of the term, while overestimating could lead to overpayment. Accurate estimation is key.
Does Marine Annual Sales Turnover Insurance cover goods in storage?
The policy can include coverage for goods in storage before or after transit, but this may require an additional premium.
How are claims processed under Marine Annual Sales Turnover Insurance?
Claims are processed based on the documentation provided, such as bills of lading and invoices. The insurer compensates the business according to the terms of the policy.
Can I include coverage for high-risk goods under Marine Annual Sales Turnover Insurance?
Yes, businesses can add coverage for high-risk goods like electronics, luxury items, or hazardous materials, but this may require specific endorsements or higher premiums.
What is the typical duration of a Marine Annual Sales Turnover Insurance policy?
The policy typically covers a 12-month period, aligning with the business’s fiscal year or shipping cycle.
How does Marine Annual Sales Turnover Insurance handle international shipments?
The policy provides coverage for both domestic and international shipments, with options to include or exclude certain regions based on geopolitical risks.
Is Marine Annual Sales Turnover Insurance renewable?
Yes, the policy is renewable annually, with adjustments made based on the previous year’s performance and any changes in the business’s operations.
Can Marine Annual Sales Turnover Insurance be customized for seasonal businesses?
Yes, the policy can be tailored to accommodate businesses with seasonal shipping peaks, ensuring continuous coverage during high-demand periods.
Does the policy cover losses due to delays in transit?
Standard policies may not cover delays, but businesses can add specific coverage for consequential losses due to transit delays.
What documentation is required to set up Marine Annual Sales Turnover Insurance?
Typically, businesses need to provide their estimated sales turnover, details of goods to be insured, and shipping routes or modes of transport.
What are the common exclusions in Marine Annual Sales Turnover Insurance?
Common exclusions may include war risks, strikes, inherent vice, and improper packaging, though these can sometimes be added through endorsements.
How do I track the coverage limits of my Marine Annual Sales Turnover Insurance?
Insurers usually provide regular updates or access to an online platform where businesses can track declared shipments and remaining coverage limits.
What is the process for adjusting the estimated turnover during the policy period?
Businesses can request a mid-term adjustment by providing updated sales forecasts, which may lead to a recalculated premium.
Does Marine Annual Sales Turnover Insurance cover returns and reverse logistics?
Yes, the policy can cover return shipments, but this should be explicitly stated and included in the policy terms.
Can the policy cover goods in transit across multiple legs or countries?
Yes, Marine Annual Sales Turnover Insurance can cover multi-leg journeys, including transshipments and cross-border movements.
How does Marine Annual Sales Turnover Insurance support business growth?
The policy provides flexible and scalable coverage, allowing businesses to increase their shipping volumes without worrying about purchasing additional insurance.
What happens if my business’s operations change significantly during the policy period?
Significant changes in operations, such as entering new markets or introducing new product lines, should be reported to the insurer to adjust the policy accordingly.
Does Marine Annual Sales Turnover Insurance cover subcontractors or third-party logistics providers?
Yes, coverage can extend to goods handled by subcontractors or third-party logistics providers, ensuring comprehensive protection throughout the supply chain.
What impact does Marine Annual Sales Turnover Insurance have on cash flow?
By covering all shipments under a single policy, businesses can better manage cash flow, avoiding the need for upfront payments on individual policies.
Can Marine Annual Sales Turnover Insurance be bundled with other types of insurance?
Yes, businesses can often bundle this policy with other types of insurance, such as property or liability insurance, for comprehensive coverage and potential cost savings.
How does the policy handle claims involving partial loss or damage?
Claims for partial loss or damage are typically settled based on the value of the damaged goods, with compensation calculated according to the policy terms.
What role does the insurer play in risk management for Marine Annual Sales Turnover Insurance?
Insurers often provide risk management advice and resources to help businesses minimize losses and optimize their insurance coverage.
Can Marine Annual Sales Turnover Insurance include coverage for environmental risks?
Yes, businesses can add coverage for environmental risks, such as pollution or contamination, depending on the nature of the goods being shipped.
How do I ensure my Marine Annual Sales Turnover Insurance covers high-risk goods like electronics or luxury items?
To ensure coverage for high-risk goods, provide detailed information about these items to your insurer. Consider purchasing specialized coverage or higher limits to protect against the specific risks associated with high-value or sensitive goods.
Does Marine Annual Sales Turnover Insurance cover goods in transit during policy renewal?
Goods already in transit at the time of policy renewal are typically covered under the terms of the expiring policy until they reach their destination. It’s important to coordinate with your insurer during the renewal process to ensure seamless coverage.
Can Marine Annual Sales Turnover Insurance be customized for different shipping seasons or peak periods?
Yes, Marine Annual Sales Turnover Insurance can be tailored to reflect higher volumes during peak seasons, ensuring continuous coverage without the need for separate policies.
How are premiums adjusted if shipping volumes decrease during the policy period?
If shipping volumes decrease, the premium can be recalculated based on the actual declared values, potentially leading to adjustments or refunds at the end of the policy period, ensuring that you only pay for the coverage you need.
Can I cancel a Marine Annual Sales Turnover Policy before the end of the term?
Yes, you can cancel the policy before the end of the term, but the specific cancellation terms, including any potential penalties or refunds, will be outlined in the policy agreement.
What kind of documentation is needed to support a Marine Annual Sales Turnover Policy audit?
Documentation such as shipment records, declarations, invoices, and any related correspondence is typically required to support an audit. This ensures that all shipments have been accurately declared and covered under the policy.
Are there penalties for under- or over-declaring shipment values?
Under-declaring shipment values can lead to reduced claims, while over-declaring may result in higher premiums. Accurate declarations are essential to avoid these issues and ensure your coverage matches your actual needs.
What happens if the actual value of shipments exceeds the declared value?
If the actual value exceeds the declared value, your coverage may be insufficient, potentially resulting in partial compensation in the event of a claim. It’s important to regularly update your declarations to reflect accurate shipment values.
How does Marine Annual Sales Turnover Insurance handle goods that are temporarily stored during transit?
Temporary storage during transit is usually covered under the policy, but it’s important to confirm the specific terms with your insurer to ensure that this coverage is included.
How does Marine Annual Sales Turnover Insurance handle multiple shipments within a month?
All shipments made during the policy period are covered automatically, without the need for individual declarations for each shipment. Businesses report their total shipment value periodically, usually monthly, simplifying the administrative process while ensuring comprehensive coverage.
What is the sum insured?
The sum insured is the total value of goods covered under the insurance policy, usually based on the cost, insurance, and freight (CIF) value, ensuring that the full value of the goods is protected.
How does Marine Annual Sales Turnover Insurance protect against unforeseen events during shipment?
The policy protects against losses or damages caused by unforeseen events such as accidents, theft, natural disasters, and other specified perils during transit, ensuring that your business is compensated for covered losses.
What are the common types of marine claims?
Common types of marine claims include total loss (when the goods are completely lost), partial loss (when only part of the shipment is lost or damaged), general average (shared loss in maritime situations), and salvage claims.
What is General Average?
General Average is a maritime principle where all parties involved in a sea voyage share the loss if part of the cargo is sacrificed to save the vessel or the remaining cargo. This principle ensures that losses are distributed equitably among all stakeholders.
What are Salvage Charges?
Salvage Charges are expenses incurred to recover goods after a casualty, and these costs are typically covered by Marine Annual Sales Turnover Insurance. Salvage operations are critical in minimizing loss and ensuring that goods are recovered and returned.
What is the per sending limit or Per Bottom Limit?
The per sending limit, or Per Bottom Limit, is the maximum amount the insurer will pay for a single shipment under the Marine Annual Sales Turnover Insurance policy. This limit helps define the insurer’s maximum liability for any one shipment.
What is Per Location Limit?
The Per Location Limit refers to the maximum coverage amount for goods located at a single place or warehouse. This limit is designed to manage the insurer’s exposure to significant losses at a single location.
What is the Subrogation clause in Marine Annual Sales Turnover Insurance?
The Subrogation clause allows the insurer to recover the amount paid on a claim from a third party responsible for the loss. This clause is crucial for protecting the insurer’s interests after settling a claim.
What is the Contribution clause in Marine Annual Sales Turnover Insurance?
The Contribution clause stipulates that if multiple policies cover the same risk, each insurer will contribute proportionately to the settlement of the claim. This prevents overcompensation and ensures fair distribution of the liability among all insurers involved.
What happens if my shipment is delayed due to a customs inspection?
Delays due to customs inspections are typically not covered under standard Marine Annual Sales Turnover Insurance policies. However, some insurers may offer coverage extensions or endorsements to protect against specific risks associated with such delays.
Comprehensive Coverage Aligned with Your Business Growth
Optimize your marine insurance with Marine Annual Sales Turnover Insurance from Go Insure India. This policy calculates premiums based on your sales turnover, providing seamless coverage for imports, purchases, and transfers, ensuring cost-effective and hassle-free protection.