To be a successful business owner, you must ensure that your business is being run responsibly and efficiently. One way to guarantee a successful business is by safeguarding all finances, assets, company goods, and equipment in case a disaster strikes. Businesses that ship or receive items over land or water must insure goods are protected from hazards at all times, including goods in transit. Maximize your proficiency as a business owner by understanding these two policies: ocean and inland marine insurance.
Difference Between Ocean and Inland Marine Insurance
Essentially, ocean and inland marine insurance differ in what they provide coverage to. Ocean marine insurance, one of the first types of insurance created, financially protects ships and cargo in transit oversea and waterways from loss or damage.
With the creation of shipping lines via rail and road, a need for a new type of insurance was produced, known as inland marine insurance. Put simply, ocean marine insurance covers goods traveling on water, and inland marine insurance covers goods that are temporarily stored in your location and goods traveling on land.
What Ocean Marine Insurance Covers
Ocean marine insurance policies generally cover several things to protect the policyholder.
- The Vessel: Ocean marine insurance includes hull coverage. That is, if the hull or any operating equipment are physically damaged, your insurance will help cover the costs. For example, bad weather could destroy vital components of the ship and ocean marine insurance will assist in covering some if not all of the costs of repair.
- The Cargo: Itemized cargo that is lost, damaged, or stolen during an overseas trip will be covered by ocean marine insurance. This can occur through water damage, a collision, or even pirate theft.
- Liability Coverage: Ocean marine liability is commonly known as protection and indemnity, or P&I coverage. This will cover a variety of liabilities that the owner of the vessel could be exposed to including medical bills, legal expenses, or costs of the damage to another vessel due to a collision.
What Inland Marine Insurance Covers
Inland marine insurance is a special type of property insurance that offers more coverage to products than a traditional property insurance policy would. Even if your business doesn’t regularly ship items on land, there is still a chance that inland marine insurance could be beneficial to your business.
- Property in Transit: This includes any itemized cargo that is currently in motion in a car, truck, or train. This will protect against losses from damaged goods due to a shipping accident or even theft.
- Transportation Equipment: Inland marine insurance will cover the equipment used to transport goods such as a food truck, a forklift, or any contractors’ equipment. This is necessary for contractors because it protects tools and machinery no matter where they are.
- Property in Your Temporary Care: This coverage is important for businesses that trade or temporarily display expensive artwork. It will cover highly valued artwork for an allowed time.
If your business regularly ships items either by sea or by land, then consider purchasing one or both of these policies to minimize losses after an accident. However, these insurance policies can vary greatly on what they cover, so thoroughly review your insurance policy to maximize coverage and reduce cost. Make sure to contact an agent at TJ Woods Insurance if you have any questions regarding ocean and inland marine insurance.
