This is especially pertinent “given that Maersk has now declared general average, which means that the surviving cargo has to pay a share of the cost for the vessel damage, the tow, clean up, legal settlements, etc,” said iContainers vp of sales and operations Klaus Lysdal.
By law, all shipping carriers are obliged to offer a minimum amount of insurance, but it offers limited coverage. iContainers said its general advice to its clients is always to purchase additional coverage to protect themselves from worst-case scenarios.
“As a shipper, you can and should always buy extra cargo insurance to further protect your merchandise and cushion your damage. Given the uncertainties of mother nature, it’s a worthy investment as it would cover your cargo while it’s in storage and in transit until it reaches the safe hands of your buyer,” said Lysdal.
Citing the example of the Maersk Honam, iContainers said that even two weeks after the fire, Maersk has yet to confirm to which port the vessel will eventually be headed and when cargo will be able to be unloaded.
In such a situation, having cargo insurance not only facilitates the post-shipping processes financially, but also logistically, iContainers pointed out. “For clients who have insurance, filing the claim with their insurance will help speed up the process of releasing their cargo,” explained Lysdal.
He added that claims are also generally processed faster through insurance companies since without insurance, shippers may be left with various carrier-related liabilities, including a proportional portion of all the losses and damage since Maersk has since declared general average.
“Without cargo insurance, your cargo is likely to be held hostage for payment of those charges. Simply said, without insurance, you stand to gain nothing or next to nothing at most,” concluded Lysdal.
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