{"id":1273,"date":"2019-10-01T21:59:29","date_gmt":"2019-10-01T21:59:29","guid":{"rendered":"http:\/\/www.bocintl.com\/en\/?p=1273"},"modified":"2021-12-31T18:12:22","modified_gmt":"2021-12-31T18:12:22","slug":"the-boc-blast-334-cargo-insurance","status":"publish","type":"post","link":"https:\/\/www.bocintl.com\/web\/the-boc-blast-334-cargo-insurance\/","title":{"rendered":"The BOC Blast 334 &#8211; Cargo Insurance"},"content":{"rendered":"\n<figure class=\"wp-block-image\"><img decoding=\"async\" data-src=\"http:\/\/www.bocintl.com\/en\/wp-content\/uploads\/2019\/10\/Imagen19-1024x277.png\" alt=\"\" class=\"wp-image-1274 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1024px; --smush-placeholder-aspect-ratio: 1024\/277;\" \/><\/figure>\n\n\n\n<p><strong>A Challenge to Shippers\nWho Would Never Dream of Controlling the Insurance<\/strong><\/p>\n\n\n\n<p>Shippers\nwho rely on suppliers to furnish cargo insurance or who rely on their carriers\nto take responsibility for losses may be in for a big surprise. Protecting your\ninvestments by insuring your goods provides peace of mind.<\/p>\n\n\n\n<p><strong>Buying CIF: Who\u2019s really responsible if your product is lost or\ndamaged in transit?<\/strong> According to internationally accepted trade terms, referred to\nas Incoterms, suppliers selling \u201cCIF\u201d (Cost, Insurance, Freight) are\nresponsible for arranging cargo insurance. But just because your supplier has\nthe obligation to arrange insurance under CIF terms, it doesn\u2019t mean that they\nare ultimately responsible if your product is lost or damaged during transit.\nThe ultimate burden of loss falls upon you, the buyer. This is why many experts\nrecommend importers change their buying terms to EXW, FOB, FCA, CFR or similar\nterms in order to control the selection, and thereby the quality, of insurance\ncoverage.<\/p>\n\n\n\n<p><strong>How much is that insurance really costing you?<\/strong> Foreign suppliers and\ntheir forwarding agents often tack on placement fees to the insurance costs.\nThose added fees often inflate the cost of insurance well beyond market pricing\nfor the same coverage purchased in the United States. Find out how much you\u2019re\nreally paying and then compare quotes received from BOC International.<\/p>\n\n\n\n<p><strong>Is the coverage your supplier purchased for you adequate?<\/strong> Importers relying on\ntheir suppliers to arrange insurance run the risk of having inadequate\ninsurance coverage. Cargo insurance policies can vary widely in levels of\ncoverage, deductibles and special restrictions. Ask your supplier for a\ncomplete copy of the insurance policy or for a certificate of insurance\ndetailing all the policy terms and conditions<\/p>\n\n\n\n<p><strong>What\u2019s the financial health of your supplier\u2019s insurance\ncompany?<\/strong>\nRecent financial and catastrophic events have exposed the vulnerability of\ninsurance companies to sudden economic devastation. Importers are encouraged to\nmake certain their suppliers use insurers with a favorable financial rating\nsupplied by a respected financial rating service. A.M. Best, Standard &amp;\nPoor\u2019s and Moody\u2019s are among some of the world\u2019s most respected. BOC\u2019s\ninsurance company, underwriters at Lloyd\u2019s of London, has an A.M. Best\nfinancial rating of A (Excellent).<\/p>\n\n\n\n<p><strong>How will your claim be handled?<\/strong> If insurance is arranged\noverseas, will you be forced to&nbsp; deal\nwith an inexperienced, sub-contracted independent adjuster unfamiliar with the\nassessment of transportation related losses? Ask your supplier for a list of\ninsurance claims adjusters contracted by the insurance company. Adjuster and\nsurveyor networks approved by Lloyd\u2019s of London and AIMA are among the most\ncredible. BOC has a vested interest in your insurance needs and will directly\nhandle cargo claim documentation requirements to ensure prompt processing and\ntimely settlement.<\/p>\n\n\n\n<p><strong>Every Shipper Needs Cargo\nInsurance<\/strong><\/p>\n\n\n\n<p>Global\ntrading involves risk; however, broad insurance coverage minimizes your financial\nrisk. Don\u2019t leave your livelihood up to chance! Statistics show that one ship\nsinks each day and you will experience a General Average loss every eight\nyears. If you are depending on the carrier to cover losses, their\nresponsibility is limited by law as follows:<\/p>\n\n\n\n<p>Ocean\nCarriers&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; $500 per shipping unit<\/p>\n\n\n\n<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; A shipping\nunit may be defined as one ocean container.<\/p>\n\n\n\n<p>Air\nCarriers&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; $9.07 per pound<\/p>\n\n\n\n<p>Truckers&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; $.50 per pound<\/p>\n\n\n\n<p>The\ninsurance we offer is competitively priced and insures approved merchandise\nagainst physical loss or damage from external causes. By purchasing cargo\ninsurance, you can avoid inconvenience and frustration. Contact your BOC\nRepresentative at 617-345-0050 for your free quote.<\/p>\n\n\n\n<p><strong>Are you familiar with\nGENERAL AVERAGE?<\/strong><\/p>\n\n\n\n<p>2019, year to date, there are a number of notable fire cases,\nwith many resulting in General Average!<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Sincerity Ace &#8211; January 2019<\/li><li>Maersk Honam &#8211; March 2018<\/li><li>Maersk Kensington &#8211; March 2018<\/li><li>Barcelona Ferry Excellent &#8211; October 2018<\/li><li>Hyundai Auto Banner &#8211; May 2018<\/li><li>\nMOL Prestige\n&#8211; February 2018<\/li><li>\nCaribbean\nFantasy &#8211; June 2018<\/li><\/ul>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" data-src=\"http:\/\/www.bocintl.com\/en\/wp-content\/uploads\/2019\/10\/Imagen21.png\" alt=\"\" class=\"wp-image-1276 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" \/><\/figure><\/div>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td>\n     <strong>Yantian\n     Express<br>\n     Year built 2002, 100,003 dwt<\/strong>\n     Date\n     of loss: 1\/3\/19\n     Part\n     loaded with 4,000 teu <br>\n     (capacity 7,551 teu.)\n     198\n     total loss, 462 damaged required survey\n     LOF\n     salvage &#8211; security 32.5%\n     GA\n     &#8211; security estimate 28%\n     &nbsp;\n     <\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" data-src=\"http:\/\/www.bocintl.com\/en\/wp-content\/uploads\/2019\/10\/Imagen22.png\" alt=\"\" class=\"wp-image-1277 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" \/><\/figure><\/div>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td>\n     <strong>APL\n     Vancouver<br>\n     Year built 2013, 115,060 dwt<\/strong>\n     Date\n     of loss: 1\/31\/19\n     Part\n     loaded with <br>\n     (capacity&nbsp; 9,200 teu.)\n     947\n     containers affected\n     LOF\n     salvage &#8211; security 15-20%\n     GA\n     &#8211; security\n     <strong>&nbsp;<\/strong>\n     <\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" data-src=\"http:\/\/www.bocintl.com\/en\/wp-content\/uploads\/2019\/10\/Imagen23.png\" alt=\"\" class=\"wp-image-1278 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" \/><\/figure><\/div>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td>\n     <strong>ER\n     KOBE<br>\n     Year built 2001, 68,196 dwt<\/strong>\n     Date\n     of loss: 2\/24\/19\n     GA\n     declaration on<br>\n     March 12, 2019\n     NO\n     SEPARATE <br>\n     SALVAGE CLAIM\n     GA\n     \u2013 security estimate 10%\n     <\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p><strong><br>\n<\/strong><br><\/p>\n\n\n\n<p><strong>General Average \u2013 The\nConcept<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Formulated by the Ancient Greeks to deal with situations where\ncargo has been jettisoned.<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>Basic principle \u2013 that which has been sacrificed for the benefit\nof all shall be made good by the contribution of all.<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>Applies to maritime claims only.<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>Is declared by the captain when there is imminent danger to the\nvessel, voyage or crew. <\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>You are contractually obligated, via the Bill of Lading, for\nunknown and undetermined costs.&nbsp; <\/li><\/ul>\n\n\n\n<p><strong>How does it work?<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Value of the voyage is determined (vessel value plus value of\nall cargo on the vessel.)<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>Participation is determined by the percentage that the value of\nyour cargo bears to the overall value of the voyage.<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>The loss amount is determined, and participation percentage is\napplied to the loss amount to determine security deposit.<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>Shipper or their cargo insurer pay twice \u2013 first for the initial\ncontribution, then for a bond covering future adjustments to that estimate.<\/li><\/ul>\n\n\n\n<p><strong>Hidden Costs<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>The great unknown (is my cargo OK?); delays &#8211; finding a port, unloading\n&amp; sorting; has my shipment missed deadlines?<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>LCL Freight &#8211; has everyone in my container paid? Freight is not\nreleased until all payments received.<\/li><\/ul>\n\n\n\n<p><strong><br>\n<\/strong><\/p>\n\n\n\n<p><strong>Difficulties of preventing\nand extinguishing fires on the open sea, include:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Ships are larger with more varied cargo.<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>Crew are ill equipped to deal with these fires.<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>Fire-fighting tugs are often days or weeks away.<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>Prevention is difficult, with rising problems with mis-declared\ncargo.<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>IMDG Code is evolving to impose stricter rules on dangerous\ngoods (DG.)<\/li><\/ul>\n\n\n\n<p><strong>Problems Facing the\nIndustry<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Stricter rules on DG will lead to higher costs and more\nincentive on the part of shippers to avoid proper declarations<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>Ship owners and shipbuilders need to improve fire-fighting\ncapabilities with CO\u00b2 systems being shown to be inadequate &#8211; cost benefit\nanalysis \u2013 are potential losses greater than the prevention costs?<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>National Cargo Bureau in NY found in 2017 that of 1,721 stowage\nplans inspected, 20% showed errors with DG<\/li><\/ul>\n\n\n\n<p><strong>General Average will never\ngo away, so how do we make that less painful?<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Awareness across all business units that losses &amp; delays are\npart of any supply chain. Mission-critical shipments need more risk analysis to\ndetermine transport mode.<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>Understanding of what to do when General Average occurs. This is\nbest led by your cargo insurance provider meeting with your \u2018team,\u2019 not just\nthe risk manager or CFO. <\/li><\/ul>\n\n\n\n<p>When was the last time\nyour insurance provider did this for you? <\/p>\n\n\n\n<p>Do they know how to handle\na GA claim? <\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Have a contingency plan or at least an understanding of how the\nevent will unfold.<\/li><\/ul>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" data-src=\"http:\/\/www.bocintl.com\/en\/wp-content\/uploads\/2019\/10\/Imagen4.jpg-1024x94.png\" alt=\"\" class=\"wp-image-1247 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1024px; --smush-placeholder-aspect-ratio: 1024\/94;\" \/><\/figure>\n","protected":false},"excerpt":{"rendered":"<p>A Challenge to Shippers Who Would Never Dream of Controlling the Insurance Shippers who rely on suppliers to furnish cargo insurance or who rely on their carriers to take responsibility for losses may be in for a big surprise. Protecting your investments by insuring your goods provides peace of mind. Buying CIF: Who\u2019s really responsible<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[507],"tags":[],"class_list":["post-1273","post","type-post","status-publish","format-standard","hentry","category-the-boc-blast"],"_links":{"self":[{"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/posts\/1273","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/comments?post=1273"}],"version-history":[{"count":1,"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/posts\/1273\/revisions"}],"predecessor-version":[{"id":2146,"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/posts\/1273\/revisions\/2146"}],"wp:attachment":[{"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/media?parent=1273"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/categories?post=1273"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bocintl.com\/web\/wp-json\/wp\/v2\/tags?post=1273"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}