Marine Transit & Workmen's Compensation
Two exposures that most small businesses carry uninsured: the stock that is in a truck right now, and the legal liability owed to the people doing the work.
Placed by Naveen Kumar Pandey, IRDAI-licensed insurance agentNo consultation fee
What this actually is
Marine cargo insurance covers goods in transit against loss or damage, whether they move by road, rail, air or sea — the name is historical, and it applies just as much to a lorry between Lucknow and Kanpur as to a container ship. A single transit policy covers one consignment; an open policy covers all your movements over a period and is declared against as you go, which is far simpler for a business dispatching regularly.
Do not assume the transporter is covering you. A carrier's liability is limited by law and by their own contract terms, and it is usually a small fraction of the value of the goods. If your consignment is damaged, that limit is what you will be arguing over.
Workmen's Compensation, now Employees' Compensation, covers your statutory liability to employees for death or disablement arising out of and in the course of employment. It is a legal obligation, not an optional benefit, and it applies to a great many employers who assume it does not apply to them.
Group personal accident cover sits alongside it and pays a benefit on accidental death or disablement regardless of whether it happened at work, which is often the cover employees actually value.
Key facts
- Our appointment
- Bajaj Allianz General Insurance, agency code BAG10104147
- Marine cargo
- Covers goods in transit by road, rail, air or sea
- Open policy
- Covers all dispatches over a period, declared as they occur
- Carrier's liability
- Legally limited and usually far below the value of the goods
- Employees' Compensation
- Statutory liability for death or disablement arising out of employment
- Group personal accident
- Pays on accidental death or disablement, on duty or off
This suits you if
- Traders, distributors and manufacturers dispatching goods
- Importers and exporters
- Any employer with workmen, including contractors and factories
- Businesses whose contracts require proof of employee cover
How it works, step by step
Choose single transit or open cover
One consignment, or a running policy you declare dispatches against. Regular dispatchers should be on an open policy.
Set the basis of valuation
Usually invoice value plus freight plus a margin. Agree it before a claim, not during one.
Pick the right ICC clause
Institute Cargo Clauses A, B or C give progressively narrower cover. We explain what each one leaves out.
List the workforce
Categories, headcount and wage roll drive the Employees' Compensation premium.
At claim time
For cargo, note the damage on the delivery receipt and file the carrier claim within the time limit. For employee claims, report the accident immediately.
What you will need
- Invoice and packing list for the consignment
- Transport document — lorry receipt, railway receipt, airway bill or bill of lading
- Details of goods, packing and route
- For employee cover: wage roll, headcount and job categories
- Previous policy and claim history
Do not have all of it to hand? Send what you have — we will tell you what is still needed.
What can go wrong
Every product has a downside. Here is this one's, in plain language, before you decide anything.
- Insurance is the subject matter of solicitation. Read the policy wording before concluding a sale.
- Relying on the transporter is a mistake. Carrier liability is capped by law and contract and rarely approaches the value of the consignment.
- Inadequate or improper packing is excluded under every cargo policy. Packing is your responsibility.
- Institute Cargo Clauses B and C are materially narrower than A. Cheaper cover here means specific perils are simply not covered.
- Damage must be noted on the delivery receipt at the time and the carrier claim filed within a short statutory window. Miss it and recovery is prejudiced.
- Employees' Compensation is a statutory liability. Not insuring it does not remove the obligation — it just means you pay it yourself.
Questions people ask us about this
The transporter says they are insured. Do I still need marine cover?
Yes. A carrier's liability is limited by law and by their contract, and it is typically a small fraction of what your goods are worth. Their policy protects them, not you. Marine cargo cover in your own name is what actually pays for your loss.
Is Workmen's Compensation compulsory?
The liability to compensate an employee for death or disablement arising out of employment is statutory. Insuring it is how employers fund that liability, and many contracts and tenders require proof of it before you can work on site.
What is an open policy?
A running marine policy that covers all your dispatches over a period. You declare consignments as they go rather than buying a separate policy each time. For anyone dispatching regularly it is both cheaper and far less likely to leave a gap.
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Still deciding?
Ask us anything about this product — including how we are paid on it. We will answer straight.