Marine Insurance Claim Process

Marine Insurance in India is a policy designed for ship owners, terminal handlers, cargo owners, and other intermediaries involved in the marine cargo business. The marine insurance policy comes under the Marine Insurance Act of 1963. The policy in India is categorised into hull and cargo insurance.

The hull insurance covers the losses to the ship or vessel; there can be any damages, including equipment, machinery, etc, during the transit. The cargo insurance covers the losses to goods during the transit via water, land or air.

Not only does the marine insurance policy provide coverage against man-made risks such as theft, collision, etc, but also against weather-related issues like hurricanes, storms, etc.

While conducting any business, there can be a wide variety of risks. Problems do not come knocking on doors with prior information; as a business owner, you need to be prepared for every unforeseen circumstance that occurs in your business.

With a marine insurance policy by your side, you will be assured that the insurance company will provide the claim if something happens during the transit. But you need to carry out the claim procedure to get the settlement money or claim amount.

If the loss happened during the transit, the policyholder needs to file the marine insurance claim to the provider. There are various steps involved in getting the claim amount, which we have broken down for you.

Step 1: Assess the Damage or Loss - The first step before filing for a marine insurance claim is thoroughly assessing the damage or loss during transit. If needed, prepare a list of items that are missing or lost. Also assess the reason behind the loss, such as natural calamities like thunderstorms, etc. Knowing all that will help you with the insurance claim procedure.

Step 2: Notify the Insurance Company - Once you know all about the damage and loss, and what caused it, the next step is to notify the insurance company about the incident. To have a smooth claim process, it is mandatory to inform the insurance company within the decided duration listed on your policy. If, by chance, you cannot inform the insurance provider, then someone on your behalf can also do it.

Step 3: Assess the Care Techniques - After informing the insurance company, ensure you have adopted all the care procedures and techniques to curtail the losses. The policyholder needs to follow the procedure required to protect goods imperative of insurance. A careless act on their end can lead to claim rejection.

Step 4: Survey - Upon receiving the request for claim, the insurance provider or company will send the surveyor to assess the loss and damages. The work of a surveyor is to analyse the severity of damage and what causes it. All these things will help him understand whether the kind of damage is covered under the policy. The surveyor might ask you some questions regarding the incident. Do not hide anything from the surveyor.

Step 5: Final Report and Claim- The surveyor will prepare a detailed report regarding the incident after the survey. After analysing the report, the insurance company accepts or rejects the claim request. If the damage is due to theft, it is best to file a police report, as it will be needed in the documentation and paperwork of marine insurance claim requests.

Documentation is an essential element of the marine insurance claim procedure. Improper paperwork can delay the claim settlement procedure. Sometimes, when the documents submitted are wrong, the claim request can be rejected.

Below is the list of documents that need to be submitted for the procedure for settlement of claims in marine insurance.

Claim Form - The claim form is the first thing you must fill out with all the details. The insurance provider's website lets you easily download the marine claim form. The claim form is very detailed, containing comprehensive details about the policyholder policy, such as policy number, date, type of policy and more.

Original Insurance Copy - Further, with the claim form, it is essential to submit the original marine insurance certificate or copy. This certificate is issued to policyholders when taking out the marine insurance policy. This is a crucial document as it contains all the information about policy, like policy number, inclusion and exclusion, etc.

Bill of Lading Copy - BOL or bill of lading is the document shippers get from the carrier provider. In the transit business, it is the acknowledgement receipt from the carrier provider. Not just this, this document also has information about the shipment and where it needs to be delivered. At the time of maritime insurance claims, this document needs to be submitted by the policyholder.

Survey Report - Along with other documents, the policyholder must submit a copy of the survey report given by the surveyor. The positive survey report supports the claim settlement in your favour.

Original Invoice - Another document that needs to be submitted with the marine insurance claim form is the original invoice for damage done to goods and equipment. Along with that, the weight notes and packing list also need to be submitted.

Shipping Specification - This is the form or document with detailed information about the shipping the insurance company needs.

Correspondence Exchanged - The document refers to written communication between parties involved in the insurance transaction.

Claim Bill - Policyholders must submit the estimated claim amount with details to the insurance provider.

With the documentation above, a policyholder must also submit a copy of the monthly declaration of transits and a carrier's consignment note. The insurance provider may also request a damage or non-delivery certificate if your items are lost, damaged, or partially absent.

There are certain conditions or cases where the insurance companies can deny the marine insurance claim process, such as:

• If the intentional or planned misconduct led to the incident that caused the damage.

• Further, if the losses incurred on transit are due to war, riots or strikes, the insurance company is not liable to pay the compensation amount.

• Moreover, if the packaging of the cargo is not up to standard and that leads to damage, then the insurance company will not pay the amount.

• Besides this, if there is general wear and tear or leakage in the cargo that causes the incident, then it will not be compensated by the insurance provider.

Having marine insurance is of utmost importance to combat unforeseen circumstances. The loss or damage due to any incident can cause financial distress to individuals. But with the right marine insurance policy, they can relax knowing that the consignment and goods are well protected against any minor or significant risk. However, before buying marine insurance, ensure some points to make wise decisions.

• When selecting the marine insurance policy, choose a coverage shielding the vessel from different types of disasters, whether in or out of the water.

• Further, another thing to make sure is that the insurance policy covers the geographical location in which you intend to operate your boat or vessel.

• Besides this, while choosing a plan, look for additional coverage or add-ons that your business needs and offered by the insurance company to enhance the insurance coverage.

• Lastly, checking the claim settlement ratio before choosing any insurance company is essential. It will help you understand how many claims the insurance provider approves.

There are various kinds of risks associated with cargo and transport business. No matter how cautious or prepared you are, even minor damage or loss can affect the whole business procedure. That is why having marine insurance is essential, as it provides financial stability to the business.

Tata AIG provides risk-free and hassle-free marine insurance policies with features like flexible coverage options and prompt claim settlement to reduce customers’ financial impact.

How is a marine insurance claim calculated?

It is typically calculated based on the terms and conditions outlined in the insurance policy. The calculation of a marine insurance claim depends on various factors, including the type of policy, the nature of the loss or damage, and the policy's specific terms.

What is the basic cover in marine insurance?

The basic cover of marine insurance includes damage to cargo, ship, etc., between the point of origin and destination.

How long does the marine insurance claim process take?

The marine insurance claim procedure usually takes about 7 to 15 days.