An Overview of Maritime Insurance Coverage

Maritime insurance coverage protects vessel owners and operators in the event of an emergency. Coverage may be available to account for the financial losses and liability associated with:

• an accident or collision involving another vessel or structure;
• property loss (including lost or damaged cargo);
• physical injury;
• piracy;
• theft;
• onboard incidents (such as equipment failure, fire, explosion, accident, etc.);
• environmental incident; and
• more.

There is some difficultly defining standard regulations for marine insurance, owing to the mobile nature of vessels and the tendency for shipping vessels to cross national and international borders regularly. However, there are standard practices used by insurance carriers when underwriting a shipping company or other maritime interest.

Types of Maritime Insurance

The types of available coverage may vary with the insurance company and applicant’s own qualifications. Some common classifications and coverages available within the marine insurance industry include:

• Commercial General Liability – protection for land-based maritime properties, such as where an owner or operator conducts business or oversees maritime operations.
• Flood Insurance – special coverage to cover damage done by waters accumulated during a flood or hurricane.
• Hull Insurance – may address the financial loss associated with physical damage to the vessel’s hull. It also may cover the cost of salvage, as well as limited property damage liability in the event of a hull-damaging accident. Specific insurance riders may be available to protect a vessel under construction or one being held elsewhere as it awaits sale.
• Marine General Liability – This insurance typically combines the coverage afforded by multiple policies, such as Commercial General Liability and other marine insurance. These may be most appropriate for a maritime business that also conducts extensive land-based operations.
• Pollution Liability – Marine insurance that addresses the cost of environmental incidents. This may include a fuel leak or other event with a negative ecological impact. Coverage may address limited government fines and other liabilities. Note that this coverage is not standard on most maritime insurance policies and must be purchased as additional protection.
• Ocean/Air Cargo coverage – Insurance against damage to imported and exported goods traveling via water or air. This coverage should protect you in the event any cargo is lost, damaged or stolen during transit. Coverage may be extended to protect against loss that occurs during ground transport.
• Workers’ compensation – Coverage for employees injured while at work. Note that maritime and admiralty workers are covered under maritime law and the Jones Act, while land-based maritime employees typically are protected by the U.S. Longshoremens’ and Harborworkers’ Compensation Act.

Your marine insurance provider can offer a more comprehensive look at insurance coverage available to your company or vessel. Prepare for your next voyage by ordering your vessel logbooks and other necessary record books today.

Not sure what logbooks are best suited to your crew’s needs? Download this free guide and learn more about what resources are available to help you remain in compliance with federal, international and company regulations. Call 888-468-3757 to place your order.