What Is Ocean Marine Insurance?
Anyone who works with sea-faring vessels should have some form of ocean marine insurance. This type of insurance covers damages to both ships and crew while traveling on ocean waters. Depending on the type of vessel and its purpose, different types of ocean marine insurance can cover different hazards.
What Does Ocean Marine Insurance Protect Against?
The purpose of ocean marine insurance is to protect against any form of peril at sea. In many cases, an ocean marine insurance policy claim must be for damages sustained while under sail, not while lying at port. Any qualifying damages must also be from conditions the ship could not reasonably protect against.
Reasonable protection also involves the seaworthiness of the vessel. An ocean marine insurance policy will likely not give the same coverage to a ship that is not up-to-date with proper maintenance and safety precautions, as it is much more at risk for potential damages. Not all ships need the same level of maintenance to be “seaworthy,” but they should be suited for the boat’s intended purpose.
Most often, ocean marine insurance policies will function to protect ships that handle transportation of cargo and passengers. Insurance coverage is especially important for boats that go on long journeys and travel across international borders, as well as those that provide services for manufacturing and distribution options. Depending on the specific needs of a company or ship, there are different types of insurance policies.
Cargo insurance provides coverage for lawful goods through all stages of transport. Some coverage options may include the full scope from production through delivery to the destination. As the value of some goods varies during different stages of transport, cargo insurance can account for that change in value.
While basic cargo insurance focuses on goods through the stages of transport, additional policies can cover goods within warehouses, potential natural disasters, damages to goods not immediately visible upon arrival, international policies, contingent liability, and gaps between party’s insurance coverage. An “all-risk” policy will cover all types of potential damages.
Marine General Liability Insurance
Beyond just maritime exposures, ships are also at risk while docked. Additional coverage can help take care of accidents that happen both on and near the water. Some potential coverage options can include extensions for ship repairers, boat broker liability, extensions in the Gulf of Mexico, pollution buyback, bailee coverage, and punitive damages defense.
Hull and Machinery Coverage
Hull and machinery policies protect the vessel, machinery, and equipment in the event of physical damage. Often policies will cover damages related to collisions at sea and other potential third-party property damages during vessel operations.
Protection and Indemnity
Beyond just protecting the ship, it is also necessary to provide protection to any crew and passengers on board. Protection and indemnity policies cover any bodily injuries suffered by any parties aboard the vessel. These policies also provide liability coverage for accidents occurring during vessel operations.
Who Needs Ocean Marine Insurance?
Industries that may require ocean marine insurance include construction, manufacturing, maritime, transportation, technology, logistics, communications, and import/export operations. Boat builders, repairers, and terminal operators also can benefit from ocean marine coverage.
As different types of vessels conduct different operations, it is essential for boats to have the proper type of insurance coverage to fit its needs. Having inappropriate coverage types can result in complications in the event of an accident. As various rulings have set requirements for what constitutes “marine peril,” you want to make sure you’re covered. If you have questions about a potential or existing ocean marine insurance claim you should always talk to an attorney.