Why is cargo transportation insurance at the Indian border essential?

Cargo Transportation Insurance at Indian Border

Export to Bangladesh, Nepal, and Bhutan

The #insurance for the transportation of cargo by lorry up to the 𝗜𝗻𝗱𝗶𝗮𝗻 𝗯𝗼𝗿𝗱𝗲𝗿 for shipment to #Bangladesh, #Nepal, and #Bhutan is commonly done. The major threat of loss is fire due to the detention of the vehicles along with the #cargo at the 𝗜𝗻𝗱𝗶𝗮𝗻 𝗯𝗼𝗿𝗱𝗲𝗿 prior to customs clearance due to traffic congestion. The cargo like cotton, jute, and garments is susceptible to fire, theft, pilferage and 𝘄𝗮𝘁𝗲𝗿 𝗱𝗮𝗺𝗮𝗴𝗲 during the detention period. Trucks are known to have waited for weeks before their examination is done by the 𝗖𝘂𝘀𝘁𝗼𝗺𝘀 𝗔𝘂𝘁𝗵𝗼𝗿𝗶𝘁𝗶𝗲𝘀 prior to crossing the 𝗜𝗻𝗱𝗶𝗮𝗻 𝗯𝗼𝗿𝗱𝗲𝗿.

The #Insurers, at times, grant cover up to the Indian border but do not specify when the cover will terminate after the arrival of the vehicle at the 𝗜𝗻𝗱𝗶𝗮𝗻 𝗯𝗼𝗿𝗱𝗲𝗿. In our opinion, the detention of vehicles due to traffic congestion prior to 𝗰𝘂𝘀𝘁𝗼𝗺𝘀 𝗰𝗹𝗲𝗮𝗿𝗮𝗻𝗰𝗲 is beyond the control of the insured. Hence, the cover will continue, but the insurer’s risk exposure gets multiplied.

Secondly, if the contract between the 𝗦𝗲𝗹𝗹𝗲𝗿 and the 𝗕𝘂𝘆𝗲𝗿 suggests extending the cover-up to the buyer’s warehouse or at the designated delivery place of the buyer under 𝗖𝗜𝗙 𝗼𝗿 𝗗𝗣𝗨 terms, there is no harm to issue a policy in accordance with the terms of sale. In fact, 𝗗𝗣𝗨 should be the most suitable term of trade in this case.

In the case of import of cargo from Bangladesh, Nepal, or Bhutan, the delivery of cargo to the Indian importer will be after customs clearance. It is similar to a ‘Tail end’ risk and difficulties will arise to ascertain the pre-existing damage without a pre-dispatch survey. The Insurer may cover the risks under 𝗜𝗧𝗖 (𝗕) terms with other extraneous perils.