Negotiate insurance at the outset

Cover to inaccessible destinations creates extra burden KEVIN MAYHEW CAREFUL PLANNING to meet tight deadlines is part and parcel of what project cargo is all about but problems may arise when a client needs to arrange insurance after all contracts have been set up and signed. They could find that insurers are not able to comply with the terms that the contracts demand, according to marketing manager of Prestmarine International, Susan Bester. “Clients have experienced difficulty in extending cover on CIF shipments when the actual site is thousands of kilometres from the port, but insurance was only arranged to the port of discharge. It is therefore of the utmost importance that the insurance aspect is negotiated at the same time as the contract to ensure continued cover right up to site and then to include further cover if necessary for erection and testing at the site,” Bester explained. Project insurance costs continue to increase and this has created some problems for insurers as cargo often has to be covered to more inaccessible places than previously. Huge volumes and values are involved that have to be transported by sea and or road with all the attendant risks. “The problem of claims in less accessible places remains a concern for insurers as there is a lack of repair facilities, documentation and co-operation from the insured’s clients on the receiving end of the journey. These factors require careful rating by insurers,” she concluded.