Benefits of Marine Captive Insurance: Things You Need to Know

What is Captive Insurance?

Captive insurance, in a general sense of the term, is an insurance company that is owned and controlled by its insureds. Its primary purpose is to ensure the risks of its owners and that insureds could benefit from the captive insurer’s underwriting profits.

What is Marine Insurance?

Marine Insurance is another variant of insurance and is provided to ships, boats, and the cargo that is carried in them. Marine captive insurance is very important because then, ship owners and transporters can be able to claim damages, especially considering the mode of transportation that they use.

Types of Marine Insurance

1. Hull Insurance

This mainly caters to the torso and hull of the vessel along with the articles and pieces of furniture on the ship. This type of marine captive insurance is mostly taken out by the owner of the ship to avoid a loss to the vessel in case of mishaps occuring.

2. Machinery Insurance

This maritime insurance covers all essential machinery.

3. Protection & Indemnity (P&I) Insurance

This is provided by the P&I club, which is a ship owner’s mutual insurance covering the liabilities to the third party that is not covered in standard H & M and the other policies.

4. Protection

Risks that are connected with the ownership of the vessel.

5. Indemnity

Related to the hiring of the ship.

6. Liability Insurance

Compensation is sought to be provided for any liability occurring on the ship crash or colliding and other attacks.

7. Freight, Demurrage, and Defence (FD&D) Insurance

Handling assistance and legal costs for a wide range of disputes that are not covered in the other insurances.

8. Freight Insurance

This type of marine captive insurance offers and provides protection to merchant vessels’ corporations that stand a chance of losing money from freight in case the cargo is lost due to an accident.

9. Marine Cargo Insurance

This caters specifically to the marine cargo being carried by ships and belongings of a ship’s voyages.

Types of Marine Insurance Policy

1. Voyage Policy

This is the kind of marine insurance policy that avoids particular voyages.

2. Time Policy

Marine captive insurance is valid for a specific amount of time.

3. Mixed Policy

Offers a client the benefit of both time and voyage policy.

4. Open or Unvalued Policy

The value of the cargo and consignment is not put down in the policy beforehand so reimbursement is done after losing cargo and it is inspected and valued.

5. Valued Policy

It makes the value of the reimbursements clear in case of any loss of cargo and consignments.

6. Port Risk Policy

This type of marine captive insurance policy is taken out to ensure the safety of the ship while it is in a port.

7. Wager Policy

There are no fixed terms for reimbursements mentioned and if the insurance global marine insurance companies find the damages worth the claim, then that is when the reimbursements are provided, is not, then there isn’t. 

It is also to be noted that this wager Marine captive insurance company is not valid under the court of law.

8. Floating Policy

A marine insurance policy where the amount of claim and other specific stuff is omitted till the time the ship embarks on its journey. This is the most ideal for clients who undertake frequent trips of cargo transportation through the water.

9. Single Vessel Policy

For small ship owners having only one ship in different fleets. This marine captive insurance policy covers the risk of one vessel of the insured.

10. Fleet Policy

Several ships belonging to one person are insured under the same policy.

11. Block Policy

This Marine captive insurance policy protects the cargo owner against damages or loss of cargo. This includes covering all the risks of rail, road, and sea transport.

Benefits of Marine Captive Insurance

1. Gain a level of control of the overall insurance program.
2. Coverage availability and capacity
3. Stabilizes the cost and say in distribution is funds
4. Focused loss control services tailored claims handling
5. Potential for tax advantages
6. An alternative way to access the reinsurance market
7. An alternative to “trading insurance dollars” with commercial insurers

Marine insurance is full of complex dealings that involve a whole lot of thought and straightforwardness in order to have a common ground of payment and receiving but it caters to a lot of people and offers a whole range of services and policies for easy and uncomplicated business transactions, They cater to the interest of their clients and insurance providers both the same, resolving the problems of all shapes and sizes.