Marine Cargo Insurance

Do I need cargo insurance?

Without marine cargo insurance, importers don’t have any real protection if your goods are…

  • damaged
  • lost in transit
  • subject to a General Average

Damage to a container can have devastating consequences for businesses relying on their goods to arrive safely. And carrier liability does little to nothing to help with the costs.

There may even be a link between the increasing size of cargo ships and disasters they encounter.

What is a General Average?

A General Average (GA) is a provision of maritime law that spreads losses across all cargo owners with freight on board.

All parties must pay a set amount for their cargo to be released, regardless of whose cargo was lost or damaged and at what cost.

Example: When the Ever Given blocked traffic in the Suez Canal for a week, the vessel’s owners declared what may be the largest General Average in history.

Carrier liability vs. cargo insurance

Like a car warranty vs. auto insurance, carrier liability has to do with the responsibilities of the shipping line and is not intended to provide importers and exporters with actual coverage.

Even when carrier liability applies, it is usually nowhere close to being enough to cover costs of damage or loss. Cargo lines typically offer rates per pound that amount to vastly less than the cargo’s actual worth.

Depending on how your bill of lading or airway bill is worded, your total reimbursement may be limited to a maximum of $500 per ocean container (or $9.07 per pound for an air shipment) in the case of a loss.

Did you know that carrier liability does not cover damages caused by natural disasters?

What does cargo insurance cover?

Cargo insurance offers protection from external damage during transit—of one’s own cargo or in the case of a General Average (GA) claim.

How do I get cargo insurance coverage?

Talk to your Customs broker or freight forwarder about marine cargo insurance.

As part of our Customs brokerage and freight forwarding services, C J International can provide you with reasonably priced cargo insurance coverage based on the value of your freight.

If you have any questions about marine cargo insurance or would like to receive a quote, please contact your local C J International representative.

Our blog posts are for informational purposes only. While we use reasonable efforts to furnish accurate information, C J is not liable or responsible for the accuracy or reliability of any information contained herein.


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