The Did You Knows? Marine Insurance
When it comes to Marine Insurance, do you know where your risk and responsibility starts and stops for the goods you buy or sell?
We see many freight forwarding customers risking it all when it comes to Marine Insurance until they go off the edge of the waterfall, but did you know that from 2008-2022, globally - over 1500 containers on average were lost overboard per year.
When we think of insuring our cargo while travelling the Seven Seas, we tend to only consider storms and choppy seas causing containers to fall off the vessel. Now, when you consider the number of containers moving across the ocean each year, this is probably a small drop in the…well ocean.
But here's the catch!
The liability of damage or loss to the ship itself, its machinery and equipment as well as the goods being transported lies with you, the customer too. The vessel's risk is essentially your risk too, not just the vessel owner's or the operator's.
If 'General Average' is called, all parties with an interest in the voyage are expected to contribute to the costs of rescuing, repairing and/or salvaging the ship, it's cargo and any resultant damage or losses, even though they are not directly at fault.
General Average is an ancient maritime law, created for situations where cargo needed to be thrown overboard to save the ship in perilous situations. The law however also applies in the event of a vessel breakdown, accident or it sinks.
While uncommon, there are plenty of incidents globally where this takes place - in recent times, many will remember the Francis Scott Key Bridge in Baltimore, USA collapsing after being hit by the Dali container ship in 2024. Closer to home, the Rena ran aground in Tauranga in 2011 resulting in a several year salvage. In both these situations General Average was called and the burden of repair, salvage and recovery was/will be shared.
If you're shipping - Marine Insurance is essential to protect your risk!
Reach out to the Hobbs Global Team to learn more: