by Hobbs • 17 JUL 2025

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:

info@hobbsglobal.co.nz

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❔ The Did You Knows? ❓VGM - Verified Gross Mass

Have you ever wondered how a shipping vessel maintains its stability while at sea with all those heavy containers on board? There is a sizeable amount of planning that goes into protecting vessel stability, preventing stack collapses and ensuring the safety of port and dock workers. Verified Gross Mass or VGM is the total weight of a packed shipping container, verified by the shipper as required by International Maritime Organizations (IMO) Safety of Life at Sea (SOLAS) regulations. This mandatory requirement which came into effect internationally in July 2016, ensures the safe loading of containers onto vessels by preventing accidents caused by overweight or incorrectly declared containers. There are two generally accepted methods of declaring a VGM: Weighing the packed container and all its contents using certified equipment. Trucks generally utilise weigh bridges as a means of calculating this. Weighing the cargo (goods weight), dunnage (packaging weight) and empty container (tare weight) separately and then summing these weights to calculate the container's total gross mass. But who is responsible for declaring the VGM? The shipper is legally responsible for providing the accurate VGM for each and every packed container delivered to the shipping line. No packed container is allowed to be loaded onto a ship unless a VGM has been provided. A missing or incorrect VGM declaration can lead to rejections and delays of containers loading a vessel. This may result in a container being rolled to the next sailing. Subsequently, additional charges may apply in the form of storage, demurrage, rebooking fees, and/or emergency weighing at the terminal. Fines, penalties, insurance validity complications as well as legal action can also be the result of serious VGM compliance issues. It is important from a health and safety perspective to ensure all those operating at sea and around shipping vessels remain safe. If you have any questions, or need help completing a VGM for your export container(s), please reach out to the Hobbs Global Team; 📨 info@hobbsglobal.co.nz

by Hobbs • 28 AUG 2025