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Insurance

360 Logistics can easily arrange Marine insurance for customers. This insurance is highly recommended and covers any loss or damage of cargo and goods, and any transport or cargo by which property is transferred, acquired, or held between the points of origin and final destination. We can arrange this insurance under our open policy for customers who donít have their own marine policy.


Why insure in New Zealand?

Exporters

When selling goods on cost, insurance and freight (CIF) terms, on conditions agreed with the overseas buyer, an exporter has control over arranging the marine insurance for the transit of the goods. After issuing the policy in the exporterís name, the insurance certificate (issued in terms of the annual policy) is assigned to the overseas buyer and the reverse endorsed. This should be done before risk in the goods passes from seller to buyer. If goods are lost or damaged during the transit then the buyer is able to make a claim under his own name.

Until ownership of the goods transfers to the buyer under the terms of sale contract, the seller is at risk for loss or damage to the goods in transit. The CIF invoice price usually enables the exporter to fully recover the marine insurance cost.

The exporter can protect their hard-won markets overseas by providing insurance through a world-class insurance company, who has claims settlement contacts in their buyersí countries. Insurance brokers strongly advise exporters to try to sell on CIF terms of sale, due to the possible advantages the exporters could receive. Also CIF sales mean that an insurance service is being exported as well as the physical export. There is an added benefit to New Zealandís economy by improving foreign currency revenue.

CIF Terms - Benefits to Exporters

The cost of marine insurance can be passed on to the overseas buyer through the CIF invoice. With the assistance of the insurer, the conditions of the marine insurance can be adapted to meet the requirements of both the overseas buyer and the exporter by negotiation prior to shipment.

If the exporter does not arrange an annual cover that provides him with a CIF facility, there will be the additional cost of separate marine insurance in their own name against loss or damage to cover his risk in the goods until the risk is passed to the overseas buyer under the sales contract terms.

Exporters gain valuable information from claims that do occur overseas. Overseas survey reports obtained by a pro-active New Zealand insurer can assist with risk management and marketing issues.

Importers

Importers are well advised to consider marine transit insurance against loss or damage for their goods. In the past this has proved to be crucial for New Zealand importers. Although modernised shipping techniques have greatly reduced some transportation dangers, the insurance claims payments on New Zealand imports are millions of dollars each year. Annual contracts have additional benefits, where wider terms than Institute Clauses can be purchased. Two common examples are expediting expenses (extra expenses incurred in obtaining replacements or replacement parts by airfreight) and debris removal (the costs of dumping damaged product).

Importers should consider importing on cost and freight (C&F) terms, compared to cost, insurance and freight (CIF) terms. These are more beneficial terms for importers. An importer does not have to deal with a foreign insurer. C&F is more beneficial for the New Zealand economy as each time an importer uses CIF they are importing the sellerís insurance and increasing the foreign currency cost. New Zealand importers do not have to pay additional overseas funds if they insure the goods. However, if the goods are insured by the seller, this increases any currency exchange risks.


The Benefits of buying on C & F Terms

Premium Costs

If arranged off-shore, insurance rates may contain additional hidden costs loaded by the seller. The importer is usually unaware of, and has no power over, the amount of the marine insurance premium charge. New Zealand insurers can provide competitive quotations.

Policy Conditions

By taking out separate marine insurance in New Zealand, importers have the advantage of arranging their insurance policy according to the conditions that best suit their needs. They also have the option of selecting their preferred insurer. With CIF terms, an importer has none of these choices and this may result in a shortfall in protection.

Claims Handling

The most prominent advantage of importers buying on C&F terms is that claims for lost or damaged goods can be made and dealt with their own insurer in New Zealand. This enables the whole claims process to be straightforward and issues to be resolved quickly and easily. On CIF terms the importer has less control over the insurerís claims process. Documents may not be requested all at the same time, and can be sent back and forth overseas, with the overseas insurer then and only then sending funds for settlement. This is very time consuming and can extend the claims process.

For more information on Marine Insurance or other International Trade solutions, please contact us