Many decisions on purchasing insurance are made purely down to price. The claims scenario below is a real situation that occurred, the 2 responses below show how two different policies would respond to the same claim. In this instance, the client had the wider cover and was extremely glad they opted for the better product!
Claim Scenario – Marine Cargo Insurance
A client’s business involved importing marble kitchen worktops from China, via Sea. While loading, a container was dropped into the water and the load inside suffered extensive damage. The company concerned ordered products just in time to fulfil contracts, however the replacement goods were going to take several weeks to manufacture. The risk to the business was significant as if they couldn’t fulfil their customer contracts, they would lose out to another supplier.
The superior product which the client had taken out.
The policy covered the damaged goods, at nearly £100,000.
In addition there was an Airfreight Replacement Clause. This extension allowed, if the assured deemed it necessary, to send the replacement goods by Air to ensure the original delivery date was met. The extra cost here was another £100,000.
Standard Marine Cargo Product.
As above, the damaged goods would be covered.
However, the Airfreight Replacement Clause is either not included, or extremely limited to a maximum of £25,000.
The client received a higher settlement of at least £75,000 by having the better insurance product.
Critically, the fact the replacement goods arrived in good time it meant they didn’t lose customers which would have a significant impact on the health of their business.
I would be delighted to offer you some free advice, either on placement issues or a real claims example. Please feel free to contact me on 01245 449 063
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