Marine insurance first developed as an extension of Ocean
Marine insurance to provide coverage for cargo that travels
over land instead of by sea. From there, however, Inland Marine
insurance branched out to provide very broad coverage on a
wide variety of portable property in addition to the coverage
it continues to provide for cargo in transit.
help identify the kinds of risks that are eligible for either
Ocean or Inland Marine insurance, the insurance industry developed
the Nationwide Definition. The Definition lists six categories
of eligible Marine risks:
Instrumentalities of transportation or communication
Personal property floater risks
Commercial property floater risks
first two categories, imports and exports, are covered by
Ocean Marine insurance. Personal property floater risks are
covered by Personal Inland Marine insurance. The three remaining
categories represent risks eligible for Commercial Inland
* Domestic shipments
Instrumentalities of transportation or communication
Commercial property floater risks
wide variety of seemingly unrelated risks falls into the categories
eligible for Commercial Inland Marine coverage. Usually, the
characteristic that makes them eligible is an element of portability,
although there are exceptions. But as a general rule, Inland
Marine insurance does not cover stationary property such as
real estate, furniture, fixtures, or merchandise while it
is being manufactured.
shipments are covered through a variety of Inland Marine Transportation
forms that cover property being transported.
of transportation or communication include forms that cover
property related to transportation or communication, such
as bridges, pipelines and television towers.
property floater risks embrace a number of subcategories of
Inland Marine forms, including Bailee’s Customer forms,
Equipment forms, Business floaters, and Dealers policies.
and Nonfiled Forms
Inland Marine insurance can cover such a wide variety of mobile
property, there is no one standard policy. Instead, each type
of property requires a unique policy form, with each company
preparing its own contracts. The only exception is filed (controlled)
classes of Inland Marine insurance that can be written under
the Commercial Inland Marine Coverage part of the Commercial
Package policy. They include these coverage forms:
* Mail Coverage Form
Physicians And Surgeons Equipment Coverage Form
Theatrical Property Coverage Form
Film Coverage Form
Commercial Articles Coverage Form
Accounts Receivable Coverage Form
Valuable Papers And Records Coverage Form
Signs Coverage Form
Jewelers Block Coverage Form
Floor Plan Coverage Form
Equipment Dealers Coverage Form
Camera And Musical Instrument Dealers Coverage Form
forms for other Inland Marine coverages not specifically listed
are known as nonfiled classes or forms.
Domestic shipments category of the Nationwide Definition includes
a number of nonfiled Inland Marine Transportation forms that
provide coverage for shipments traveling by truck, train,
air, or mail.
that ship or receive merchandise need coverage against loss
to their cargoes while they are in transit. Common carriers
- those who hold themselves out to the public to ship goods
- must accept a certain amount of liability for losses to
cargo. (These obligations are set forth in the bill of lading
that must be issued to each business for whom the carrier
ships goods.) However, there are many losses for which the
carrier is not responsible. Even loss may be uncertain. The
various Inland Marine Transportation forms were developed
to cover this exposure.
Annual Transit policy protects the shipper or receiver of
goods against loss to goods in transit. Coverage is available
on a named peril basis, protecting against such losses as
fire, windstorm, collision, and theft, or on an open peril
basis. The policy covers all of the insured’s incoming
or outgoing shipments during the year.
Trip Transit policy is similar to the Annual Transit policy.
However, it is used to insure single shipments of goods for
companies that have only occasional shipments to insure. Coverage
extends from the time and point of origination to the time
and point of destination.
nonfiled Motor Truck Cargo policy covers cargo while it is
being transported in a truck. It protects the carrier, instead
of the shipper, for liability for loss to domestic shipments
in transit. The carrier has a responsibility to deliver goods
entrusted to it unharmed. There are only a few things, such
as acts of God (floods, tornadoes) or the shipper’s
own neglect (poor packing), for which the carrier is not liable.
This form is sometimes called the Motor Truck Cargo - Truckers
variation of Motor Truck Cargo insurance provides coverage
known as owner’s goods on owner’s trucks to companies
that transport their own goods. It provides direct damage
coverage instead of Liability coverage. This form may also
be called the Motor Truck Cargo - Shipper’s form or
the Motor Truck Cargo - Owner’s form. Some companies
issue a Motor Truck Cargo - Combination form that provides
both Liability coverage for the shipment of another’s
goods and direct damage coverage for the shipment of the insured’s
own goods on its own trucks.
Of Transportation And Communication
next category of the Nationwide Definition, Instrumentalities
of transportation and communication, includes forms covering
property such as bridges, tunnels, oil pipelines, loading
docks, and radio and TV towers.
this property itself is not portable, it is directly connected
with transportation and is subject to many of the same perils
as property in transit.
Property Floater Risks
are a number of nonfiled forms that fall under the Commercial
property floater risk category of the Nationwide Definition.
Bailee’s policies are a subcategory for which there
are no filed forms but for which there are several important
is the delivery of property by the owner to someone else to
be held for some special purpose, and then returned to the
owner. An example of bailment is leaving your shoes at the
repair shop to have them reheeled. The bailee is the one who
receives the property; the one who owns the property is called
as carriers have a responsibility for the safety of property
in their custody, bailees also have a responsibility for property
in their custody. If the property is damaged through the bailee’s
own fault, he or she will be liable to the customer for damage.
But even when the property is damaged in a fire or some other
disaster that is not the bailee’s fault, the customer
will expect to get the property back undamaged or be compensated
for the loss. To retain the goodwill of the customer, the
bailee will probably reimburse the customer. The Bailee’s
Customer policy reimburses the insured for damage to a customer’s
property that is in his or her care, regardless of whether
the insured is liable for the damage, as long as the damage
resulted from a covered peril.
are several different Bailee’s Customer policies available
that are tailored to specific businesses, such as the Cleaners,
Dyers And Laundries policy. One unique peril covered by this
form is confusion of goods, which covers the loss that can
occur when the resulting damage from another loss has made
it impossible to identify which garments belong to a particular
are a number of nonfiled Equipment floaters, one of the most
important of which is the Contractors Equipment floater.
Contractors Equipment floater covers the heavy machinery,
equipment and tools a customer needs to conduct business.
It covers the contractor on an open peril or named peril basis
for loss to all types of tools, machinery and equipment owned,
rented or borrowed by the insured. The property is protected
from loss by fire, landslide, theft, and other perils while
it is on the job site, on the way to and from a job site and
in temporary storage. Neither the Commercial Property nor
the Commercial Auto policies provide the extensive coverage
that can be obtained under the Contractors Equipment floater.
are also two nonfiled forms in this subcategory of Commercial
property floater risks.
firm selling refrigeration systems, elevators or other pieces
of large equipment may have a great deal of property on location
awaiting or in the process of installation. Such installation
and final testing can take months, even years. The Installation
policy is an Inland Marine coverage that insures against loss
to machinery, equipment, building materials, and supplies
in transit to or being used with or during the course of installation,
testing, building, renovating, or repair. It can be issued
to cover the interest of the owner, the seller or the contractor.
Electronic Data Processing Equipment floater provides open
peril coverage for computer hardware, software and data that
is owned by the insured or in the insured’s care, custody
or control. Property in transit is covered. Optional breakdown
coverage insures against damage to the equipment caused by
mechanical breakdown, electrical disturbances and temperature
changes. Extra expense and business interruption coverage
is also included.
addition to the filed Dealers policies we’ve covered,
nonfiled policies can be written for a number of dealers,
including art, stamp, coin, and antique dealers. These policies
are generally written on an open peril basis and cover property
on the premises, off the premises and while in transit, provided
certain conditions are met.
Please note that the precise coverage afforded is subject
to the terms, conditions, and exclusions of the policy as
issued. This explanation is intended only as a guideline.
This information is not intended to be considered investment,
tax or legal advice. It is provided, for your education only.
This is not an insurance contract. All terms and coverages
are defined solely by your policy.
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