Safeguard your cargo: The critical need for marine insurance

Recent fires at major ports, including the explosion aboard the YM Mobility at Ningbo on the 9th of August, have highlighted a critical issue: the danger of not having appropriate marine insurance in place. 

As global supply chains become increasingly complex and fragile, incidents like these can lead to significant financial losses for businesses that are not adequately protected. Even brief disruptions, such as the temporary closure of Ningbo’s Beilun Phase III Terminal, can worsen congestion and delay deliveries, leaving businesses exposed to unforeseen costs.

Without comprehensive marine insurance, shippers may find themselves vulnerable to substantial expenses, particularly in cases involving General Average (GA) declarations. GA requires all cargo owners on a voyage to share the costs incurred during emergencies to protect the vessel and complete the journey. Businesses without proper coverage may be liable for these costs, even if their own goods are not damaged.

The risks don’t end with the immediate impact of an incident. For example, just two days after the Ningbo explosion, another fire broke out aboard the MSC Capetown III at Sri Lanka’s Port of Colombo, again bringing attention to issues like mis-declared cargo and inadequate insurance. Fires aboard container ships are not uncommon, and without proper insurance, businesses may struggle to recover from the financial damage caused by such incidents.

Many shippers mistakenly believe that standard coverage provided by freight forwarders or carriers is sufficient. However, this coverage often falls short of protecting the full value of the goods, leaving businesses at risk. Comprehensive insurance, such as Metro’s All Risks cover, is essential for safeguarding against total loss, damage, and the financial burden of GA.

In today’s unpredictable shipping environment, businesses must prioritise securing appropriate marine insurance to protect their cargo, financial interests and cashflow.

When General Average is called, cargo owners will need to provide security for their share of the General Average, either as a cash deposit, or an Underwriter’s Guarantee.

Our All Risk marine insurance covers the full value of your goods and protects you from General Average being called, including provision of your Underwriter’s Guarantee.

For further information on protecting your cargo and our marine insurance please EMAIL Colin Redman.