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WHY MARINE INSURANCE?

In spite of the vast modern techniques and development achieved nowadays in ways and means of safeguarding a vessel and its cargo still loss or damage to cargo during transit, loading and unloading frequently occur.

Cargo Insurance has developed over the centuries such that it is an exception today for a consignment to be uninsured, therefore Cargo Insurance has become an important part of international trade.

INTRODUCTION



Whether you are a manufacturer or a trader, the movement of materials or goods is an important part of your business activity.
TRUST YEMEN understands that you have your heart in their safe delivery wherever their destination.
That’s why we go above and beyond with TYRIC Marine Cargo Insurance, not only to protect your cargo, but also to support it with settling claims fairly and promptly.

What are the advantages of insuring your goods by Trust Yemen?

  • Adequate values and competitive terms can be secured.
  • The insurance arrangements and claims negotiations can be handled directly with us.
  • The need to deal with unknown foreign insurers is avoided.
  • If there are many consignments to or from various countries, all such consignments can be covered under one open cover.
  • Cost-saving competitive rates.
  • A wide choice of cover.
  • Speed and efficiency.
  • Loss Prevention and Risk Management services.
  • Local contacts throughout the world.
  • Fair and efficient claims handling.
  • Security and reliability.
  • International reputation and expertise.

Scope of Cover

Marine Cargo Insurance covers cargo whilst in transit and includes storage in the ordinary course of transit.

Almost all marine cargo policies are subject to the terms of the Institute Cargo Clauses. The “Institute” means the Institute of London Underwriters which is a trade body representing almost 100 international insurance companies. The Clauses which are drafted by the Institute are considered to be standard terms of cover for Marine Cargo Insurance and are internationally accepted and understood.

The latest version of the Institute Clauses was made effective from 1.1.2009. These clauses are now widely used internationally. This new version updates the 1982 clauses by using more common everyday language. Some of the coverage has been expanded to suit the present demands of the changing insurance market.

The most commonly used clauses are:



Institute Cargo Clauses (A) or Institute Cargo Clauses (AIR)

Covers all risks of loss or damage to the cargo.

Institute Cargo Clauses (B)

Covers loss or damage caused by the following perils:
  • Fire or explosion
  • Stranding, grounding, sinking or capsizing of the ship
  • Overturning or derailment of the land conveyance
  • Collision
  • Discharge of cargo at a port of distress
  • Earthquake, lightning and volcanic eruption
  • Entry of sea, lake or river water into the vessel or place of storage
  • Packages totally lost during loading or unloading from the ship
  • Jettison

Institute Cargo Clauses (C)

  • Fire or explosion
  • Stranding, grounding, sinking or capsizing of the ship
  • Overturning or derailment of the land conveyance
  • Collision
  • Discharge of cargo at port of distress
  • Jettison

All Institute Clauses cover General Average and Salvage.

EXTENSIONS/SPECIAL CLAUSES:



Institute War Clauses (Cargo)/(Air Cargo)

Cover loss or damage resulting from war perils whilst the cargo is at sea or in the air. The exclusions are the same as for the Cargo Clauses with the additional exclusion of frustration of the voyage (i.e. no claim is payable if the cargo cannot be delivered or shipped because of a war).

Institute Strikes Clauses (Cargo)/(Air Cargo)

Cover loss or damage caused by strikers, rioters, terrorists or person acting from a political motive. Exclusions are the same as for the War Clauses but there is an additional exclusion regarding the shortage or withholding of labour.

Trade Terms of Sale

In the transaction of goods internationally, a seller and buyer will be dealing with people in different parts of the world. It would be convenient if we all have a common understanding on how we should do business to ensure a smooth delivery. The International Chamber of Commerce based in Paris came out with a uniform set of rules in 1936 which governs the trade terms of sales. More commonly known as the Incoterms, it has been through a few versions with the latest in 2010. The purposes of the Incoterms are to:

  • Divide the cost and risks between the seller and buyer
  • Set out the basis of responsibility for packing and affreightment
  • Form the basis for determining the extent of Marine Cargo Insurance required


With a clear definition of each party’s responsibilities, there would be fewer problems in planning and carrying out each other’s role in the transaction. It is necessary to understand the relationship between the seller and the buyer under the different types of contract of sale by referring to the Incoterms. The responsibility of arranging for Marine Cargo Insurance in international trade can be summarised as follows:

  • FOB
  • CIF
  • CIP
  • CFR
  • EXW

WHAT ABOUT THE COST?



Sum Insured The amount for which goods are insured and which forms the basis of settlement in any claim is generally based upon the following formula:

Cost, Insurance and Freight Plus 10%

This formula is in standard use in international trade practice. If it is used in an Open Cover or Annual Policy, it is referred to as the “Basis of Valuation”.

Cost is the value of the goods, usually the invoice value.

Freight is the cost of shipping the goods to the final destination. Often, these charges are included in the invoice price, but this may not always be the case.

Insurance is the premium payable for the particular shipment.

“Plus 10%” is intended to cover extra costs which the Assured may incur when shipping the goods, but which may be difficult to quantify. For example, there are administrative costs incurred by the Assured in ordering the goods and arranging shipment. It is intended to cover the Assured for unforeseen or unquantifiable costs and does not cover loss of profit.

Scope of Cover

The company will determine the premium payable for the policy from time to time depending on:

  • Nature of cargo
  • Mode of conveyance
  • Nature of packing
  • Risks to be covered
  • Destination
  • Past experience with respect to claims, (if any) under any policy/ policies
  • Any other matters connected with or incidental to the risks to be covered

Types of Policies

  • Specific Policy:
    Covers specific transit of a cargo between specified locations
  • Open Policy:
    Covers a series of transits of cargo during a specific period of insurance
  • Open cover:
    Similar to open policy but limited to covering imports

How to Arrange Cargo Insurance?

All you have to do is to fill our simple Proposal Forms in order to have one shipment policy or open cover/annual policy depending on your requirements.

Land Transit Insurance

TRUST YEMEN INSURANCE AND REINSURANCE CO. presents Goods In Transit Policy to protect your goods whilst being carried by any land conveyance within or outside Yemen against loss or damage caused by fire including internal explosion of the conveyance, collision and overturning of such conveyance. Moreover Trust Yemen has created a land transit All Risks Policy which provides an all risks cover except for some exclusions.

What about the cost of Land Transit Insurance?

Rates for Goods in Transit Insurance vary according to the nature of goods, mode of transit, packing, scope of cover required and level of deductible.

How to arrange Land Transit Insurance?

All you have to do is to fill our simple Proposal Form in order to have either one shipment policy or annual policy depending on your requirements.