Minimising Claims in Marine Insurance: Best Practices for Shippers

Marine transport has made it easy to trade goods overseas. It has been helpful with the growth of the country’s economy as well. With this, it is also crucial to note that transporting goods through marine channels is a complex and risky process that depends on climate conditions and other uncertain events.

Marine Insurance, a type of SME insurance, is a solution to safeguard the shipper from unforeseen loss. Tata AIG offers various types of SME insurance including a marine cargo insurance policy to cover a business’s losses arising from shipping events. Other than minimising marine insurance claims this is an effective way to safeguard the loss of an enterprise.

This article covers some effective ways in which a shipper can minimise claims in marine insurance policy.

  What are Marine Insurance Claims?

Marine cargo insurance is a safety net for shipowners, cargo operators, and other intermediaries that provide coverage for loss or damage caused to insured goods being shipped overseas. It financially protects the insured against various uncertainties like weather conditions, navigation problems, pirate attacks, etc.

These insurance policies are generally tailored to the insured parties’ specific needs and risks.

  Challenges Faced by Shippers  

Shippers in the Maritime industry may face various challenges when dealing with ocean marine insurance policies. These difficulties can impact their operations, financial stability, and overall efficiency. Some major challenges concerning marine insurance policy are as follows:

 High Insurance Premiums

Frequent cargo shipping or significant claims in a marine insurance policy can lead to an increase in payable insurance premiums. Insurers adjust premiums based on the perceived risk associated with a particular shipping operation. It is important to balance between getting insurance coverage and managing the financial burden of paying rising premiums.

 Documentation Challenges

Comprehensive and timely documentation has to be done for successful claim processing. Shippers may face inadequate coverage if the document contains incomplete or inaccurate information. It can lead to the rejection of a claim or delay in the process. Especially for extensive marine cargo policy, shippers need to maintain proper records, shipments, and incidents to support their claims.

 Claim Processing Delays

The process of filing and settling the marine insurance can be complex and time-consuming. Delays in processing claims may disturb the flow of operations, which can lead to financial loss. Shippers often need to go through extensive paperwork, investigations, and negotiations before receiving claim compensation. Providers like Tata AIG help with quick investigation and prompt settlement of claims.

 Best Practices to Reduce Marine Insurance Claims 

 Risk Assessment and Prevention

During overseas maritime trade of goods, shippers normally face risks that may cause the need for insurance claims. However, by taking protective measures and best practices, shippers can significantly reduce the frequency of insurance purchases. The shipper can detect the cause of controllable risks and assess them to prevent them while sending the cargo and on the way to transport.

 Investment in Safety Training

Human errors can lead to unfavourable maritime incidents. Training crew members would be beneficial in case of accidental events. This is a long-term investment that helps in the additional safety of the goods and wouldn’t require costly insurance coverage.

  Implementing Technological Solutions

In this modern era, a shipper can use various tools to prevent accidental events. For example, GPS tracking enables real-time monitoring of vessel locations, weather monitoring systems provide shippers with up-to-date information on current and forecasted weather conditions, and many other such technologies help prevent future loss to a large extent.

 Cargo Maintenance and Regular Inspection

Regular maintenance of vessels and thorough inspection are essential practices to ensure that cargo arrives at the destination as it is.

Vessels should undergo servicing and inspection for mechanical failures and breakdowns. Moreover, cargo holds should be inspected for cleanliness, proper ventilation, and moisture control measures.

 Effective Cargo Packaging and Handling

Cargo damage is a common reason for insurance claims in the marine trade industry. Adopting best practices in cargo packaging and handling is essential to minimise the risk of damage during transit.

Proper securing techniques should be employed to ensure the protection of the cargo. Water-resistant packaging materials and techniques can protect goods from moisture and reduce the likelihood of damage.


Dealing with marine insurance claims can be tricky, but due diligence and checking a few things can help you manage it. Moreover, try purchasing a marine insurance policy from a reputed insurance provider that offers flexible coverage and prompt settlement of claims.

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