Tata Aig Marine Brochure

AIG

INSURANCE

WITH YOU ALWAYS

Marine Insurance Tata AIG General Insurance Company Ltd. Registered Office : Peninsula Corporate Park, Nicholas Piramal Tower, 9th Floor, Lower Parel, Mumbai - 400 013. Ahura Office :Ahura Centre, 4th Floor, 82 Mahakali Caves Road, Andheri (E), Mumbai - 400 093.

Tata AIG General Insurance Company Limited Tata AIG General Insurance Company Ltd. is a joint venture company, formed by the Tata Group and American International Group, Inc. (AIG). Tata AIG combines the Tata Group's preeminent leadership position in India and AIG's global presence as the world's leading international insurance and financial services organization.

January 22, 2001, we have been working towards our commitment to be With You Always. Tata AIG General offers the complete range of non-life insurances for individuals and companies including insurance for automobile, home, personal accident, travel, energy, marine, property and casualty, as well as financial lines.

Tata AIG General Insurance Company Limited provides insurance solutions to individuals and corporates. Licensed to operate in India on

Tata AIG General Insurance Company Ltd. currently has it's presence in over 20 cities in the country.

Smooth sailing with Tata AIG Marine Policies With the globalisation of the economy, supplier linkages span oceans, but still require goods to be delivered to the concerned party in a pristine state, just-in-time. For that kind of criticality, who do you trust for your Marine Insurance? Only Tata-AIG. Our marine cargo policies are indispensable for any corporate engaging in trade and commerce. We cover your goods every step of the way.

Tata AIG General brings to you, the capabilities of AIG Marine, one of the largest marine insurers in the world. AIG's world-wide network, with it's presence in over 130 countries, means that your business is in the able hands of people who understand local maritime laws and customs, all around the world. Our marine policies provide you with safe harbour in turbulent seas.

READY RECKONER FOR EXPORT INSURANCE Selecting Your Ocean Carrier

Your goods are as good as the carrier you select; hence, do not compromise on this selection for making a small saving on your freight bills. Here are a few tips that will help you select the right carrier:

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Age of the vessel should not exceed 20 years for bulk and heavy cargoes and 25 years for general and containerized cargoes.

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Anything beyond these age limits would not only jeopardize your cargoes but be liable for additional premium.

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Vessel should be 'Classed' by one of the approved Classification Societies. Classification ensures physical seaworthiness of the vessel based on regular inspection by the approved societies.

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Vessel should be entered into one of the reputable P&I Clubs. This will ensure financial stability of the ship owners and / or charterers.

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Liners are vessels which ply on regular advertised time schedules and routes. Liners are a better risk than tramps.

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Register yourself on www.equasis.org and check on the complete details of the vessels. This is a free site.

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Tata AIG assists their customers by arranging for cleanliness, sea and cargo worthiness surveys, giving immense comfort to its clients.

Incoterms Incoterms are your ready guide to knowing your insurance needs.

Export Seller/ export er Document Premis es Formalities

Delivered at named place of: Frontier/ Terminal/ Quay

Loading port of shipment

Onboard Ships Rail

Onboard Discharging Ships Rail port of arrival

Delivery at named place of destination: Frontier/ Terminal/ Quay

Import Document Formalities

Buyers/ Importe rs premises

EXW-Ex Works FCA - Free Carrier FAS-Free Alongside Ship FOB - Free On Board CFR- Cost and Freight

AIG

CIF - Cost Insurance and Freight CPT-Carriage Paid To

CIP- Carriage and insurance Paid to

INSURANCE

DAF- Delivered at Frontier (Country of Export)

DAF- Delivered at Frontier (Country of Import) DES-Delivered Ex Ship DEQ - Delivered Ex Quay

WITH YOU ALWAYS

DDU- Delivered Duty Unpaid DDP- Delivered Duty Paid Sellers Risks

Buyers Risks

FAQs For Exporters Æ

Does Marine insurance cover Inland transit from the factory / inland warehouse to the load port? Although the word Marine may appear to be synonymous with Ocean voyage, in actuality, the modern day Marine insurance policies covering exports are 'warehouse to warehouse' policies i.e. from the factory / inland warehouse of the Indian exporter to the inland warehouse of the overseas buyer and encompass transits by all modes of transportation.

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How important are sale terms? The standard sale terms are FOB, C&F (CFR) and CIF (CIP). The sale terms would determine the extent of insurance requirement e.g. under an FOB /CFR sale, the Indian exporter would be responsible till the goods cross the ship's rail and Marine insurance would consequently be required up to this stage. In short the marine policy should run concurrent to the sale terms.

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What is an 'open' policy? An 'open' marine cargo policy is a policy which remains open for 12 months from the date of its inception. The open policy is advantageous to an exporter with regular shipments. Under an 'open' policy, the exporter is not obliged to 'declare' the shipment in advance: the shipment could be declared, as per agreement, at a later date subject to maintenance of adequacy of premium.

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What are Institute Cargo Clauses? Unlike policies issued by other branches of insurance which contain the schedule, conditions, definitions, exclusions, etc., a marine policy form is a 'blank' policy form which contains only the 'Schedule' with the preamble and the operative clause. The conditions of insurance are, therefore, not incorporated in the policy form. To complete the contract, insurance company takes recourse to the Institute Cargo Clauses which contain the conditions of insurance in detail. It is called 'Institute' because it is the property of The Institute of London Underwriters worldwide, majority of the insurance markets follow the London market.

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Does an 'All Risks' policy cover everything? Any insurance policy covers fortuities / accidents i.e. uncertainties. To this extent, an 'All Risks' policy (subject to Institute Cargo Clause-A [ICC A] dt.1/1/82) covers all fortuities. Certainties are, therefore, excluded in a marine policy by “general” exclusions and “unseaworthiness and unfitness” exclusions. There are 2 other exclusions in a standard marine policy known as “War” and “Strikes” exclusions. However, these 2 exclusions could be covered on request on payment of nominal additional premium. In an “All Risks” policy, the individual risks/perils are not enumerated-the policy would, therefore, pay for all losses unless it has been caused by an excluded named peril.

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Does Marine insurance cover storage at intermediate locations &/or at the port &/or at the final destination? The standard Marine policy covers movements during the “ordinary course of transit” and extends up to 60 days after completion of discharge overside of the insured goods from the carrying vessel at the final port of discharge. Therefore, this would include customary transshipments beyond the control of the Assured. The Marine insurance cover would, however, terminate where storages are intentional, voluntary and avoidable i.e. where there is a break in the “ordinary course of transit”. In short, as against common perception, the 60 days is not an automatic storage cover. Marine Policies terminate on goods reaching final destination. If it is the intention of the Assured to store the goods during the transit/voyage, it is pertinent to bring this to the notice of the Insurance Company at the beginning and the insurer may agree to extend the cover to include such storages at a premium and conditions to be agreed.

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What is The Premium Payment Regulation or Section 64 VB? Section 64 VB is a section of the Insurance Act, 1938. Under this section, an insured is required to pay full premium (including stamp duty and service tax, as may be applicable) in advance for the insurance company to assume the risk. In respect of a 'specific' policy, the full premium is required to be paid before the movement of the goods i.e. commencement of the risk. Therefore, if insurance is required during inland transit from the factory / warehouse but the carrying vehicle has already left the premises, the insurance company, in view of the premium payment regulation, could refuse the coverage. Similarly, if the vessel has sailed but premium was not paid in advance, it would be difficult for the exporter to obtain any insurance coverage for the shipment. Under an open policy, the insurance company could agree to accept advance premium based on projected exports / shipments for a period say, 3 to 6 months depending on volume: it would be the responsibility of the exporter to ensure that there is adequate deposit premium before commencement of any shipment. The exporter is allowed to pay additional premium at any time during the policy period depending on export requirements. Inadequate premium at the time of commencement of shipment could prejudice a claim.

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What is a Certificate of Insurance? A Certificate of Insurance certifies the existence of a marine insurance (open) policy. Under an open policy, it is the international practice to issue a Certificate for every shipment. A Certificate could be said akin to a Specific policy. In most cases, the open policy is adequately stamped and hence, individual Certificates need not be stamped. It is important to note that a Certificate has to be issued strictly as per terms and conditions of the corresponding open policy.

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Is Tata AIG Certificate acceptable to one and all? Yes. Tata AIG Certificates are acceptable to consignees, bankers, etc. all over world.

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Would Certificates comply with special L/C requirements? Yes. Special L/C requirement wordings could be incorporated in a Certificate as long as such wordings do not contravene the terms and conditions of the open policy.

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To whom would an overseas importer report a claim under an export policy? Every export policy / Certificate would clearly mention the names of the Claims Representative Survey agents and Claims Settling Agent. The first notice of loss is required to be given by the importer to the Survey agent mentioned on the policy/Certificate, who would in most cases, be located in the same city. Thereafter, the importer has to comply with the requirements of the Survey agent. After the Survey agent's work is complete and the report is issued, wherever required, the claim would be handled by the Claims Settling Agent. Reference of the loss by the importer to the exporter would delay the entire process and could even result in aggravation of the loss: this has to be avoided. For details of our global contacts, log on to www.tata-aig.com

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Could the exporter receive claim payment under an export policy covering CIF shipment? Depending on the merits of a case an exporter could definitely have the right to claim, as an 'unpaid vendor'. There could also be cases when the importer who is the rightful claimant desires that the claim be settled with the exporter so that the latter could make early/immediate replacement. In such cases, claim payment to the exporter could be considered against an 'NOC' from the importer.

Check your Export Marine Policy Check the following important Policy wordings to be satisfied that it is correctly issued, as per your requirements. R

Subject Matter Insured: Be satisfied that all items required to be insured are included. Items which are not specifically included or not appropriately worded in the policy would fall outside the scope of the policy.

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Packing: By “standard & customary” it is meant that the packing should be strong, stable & suitable to withstand the intended journey keeping in mind the nature of the goods, the journey involved, the port conditions at origin & destination, handling methodology at the ports & on board the conveyance, season, duration & all other aspects which would fall within the ordinary course of the transit.

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Conveyance: Check that all the probable modes that would carry the insured cargo have been included; otherwise, shipments by conveyances not included would remain uncovered. Ensure that the conveyance chosen / used is fit, suitable & clean to carry the intended cargo.

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Voyage: Check that the places included meet your requirements. Shipments to or from, as may be applicable, places not included would not be covered under the policy.

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Limit per Bottom / Sending Limit: This denotes the maximum value of any one of your shipment. Shipment values exceeding this limit would remain uncovered unless prior notice is given to the Company & suitable amendments have been made in the policy.

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Location Limit: This denotes accumulation of all your shipments at any one place at any one time, e.g. intermediate storage, carriers' or other godowns, at the port awaiting shipment & similar places.

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Basis of Valuation: This denotes the components on the basis of which the valuation should be arrived at by you, e.g. FOB (Free on Board value) value + 10%, Invoice value, Invoice value + 10%, C&F (Cost & Freight value) value, CIF (Cost, Insurance & Freight) value + 10% etc. The additional 10% is generally allowed by the Company, as per universal practice, to take care of various incidental expenses that may have to be incurred by the supplier/exporter. Shipments exceeding the Basis of Valuation incorporated in the policy would fall outside the scope. The premium is calculated on the value declared for the shipment which, as explained, should neither exceed the 'Sending Limit' nor the 'Basis of Valuation'.

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Sum Insured: Ensure that there is always adequate sum insured balance before a shipment is made, otherwise, inadequate balance would render the shipment concerned to be uncovered.

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Premium: As per Section 64 VB of the Insurance Act, 1938, adequate premium balance is required to be maintained before the commencement of a shipment. Inadequate premium balance would render a shipment uncovered.

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Declarations: Declarations assist you in maintaining adequate premium balances at all times. It is mandatory to declare all shipments that fall within the scope of the Policy within the time limit.

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Excess, Exclusions, Warranties, Conditions etc: Read these carefully & make yourself conversant with the same.

Techno Vantage: eMarine Taking forward our commitment to make insuring with us a truly pleasant experience, Tata AIG has launched eMarine. eMarine or electronic-Marine is an extremely user-friendly Web based tool. This facility has been introduced in India after its resounding success in Hong Kong, Singapore, Taiwan, Malaysia, Indonesia, China & Philippines.

Tata AIG's eMarine is a web based tool which allows you to: Æ

Generate Marine Policies / Certificates at anytime, from anywhere in the world. All you require is an Internet Connectivity and a Printer.

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Manage your policies independently, view declarations and transactions journal, check premium balances, 24 hours a day, 365 days a year, wherever you are, even from multiple locations.

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Save time, as you won't require a separate manual declaration of shipments covered.

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All this is absolutely free of cost! You don't need to pay any software fee or access charges.

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eMarine is useful for manufacturers, exporters, importers, logistics operators, insurance brokers and insurance agents; anyone who is looking for hassle free marine insurance. And your data is completely secured with industry standard encryption technology. We will give you a ‘username’ and a ‘password’ and you are ready.

Product Vantage : STOP MARINE SALES TURNOVER POLICY (STOP) STOP is a designer product for the discerning customer, an Open Policy in the real sense of the term. The premium for the policy is charged only on your sales turnover.

STOP provides you Transit insurance coverage on: Æ Æ Æ Æ Æ Æ Æ Æ Æ . Æ Æ

Imports + Customs Duty (Actual or Deemed / Contingent) + Domestic purchase of raw materials, consumables & stores + Any number of inter- factory / inter-depot / to & fro job worker movements + Exports (FOB/CIF) + Domestic sales of finished goods Temporary storage cover at intermediate locations like Job workers / C & F premises etc.

What do you gain? Sizeable saving in premium which is charged only on your sales turnover. Seamless cover with all movement of goods automatically covered. No hassles of submitting periodical declaration of movements to the insurer. Only monthly sales figures need to be submitted. Intermediate storage cover can be built into the policy. Premium on full annual sales turnover need not be paid in advance. Facility for payment of premium on half-yearly / quarterly.

This is a one STOP shop for all your marine needs.

Safety Vantage: MLCE MARINE LOSS CONTROL ENGINEERING (MLCE) Marine Loss Control Engineering is one of the most important offerings of Tata AIG's Marine policies. It helps get our Assureds' products get delivered on time and in sound condition to their clients. It has an experienced and full time dedicated team spread across the globe spanning different time zones,thus ensuring cost-effective solutions and recommendations through scientific analysis.

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MLCE Advantage: Reducing loss frequency and severity. Providing timely and accurate information on worldwide and regional industry trends, high risk areas, potential hazards and threats. Providing direct contact with the different transport vendors and security providers.

Just & Fair Claims With over 30% of the work force deployed in claims, we are determined to deliver just and fair claim settlements. We enter into Service Level Agreements with our customers, laying down mutually acceptable documentation, turn around times and specific customer requirements which go a long way in setting the service parameters and ensuring a smooth ride when claims arise. Tata AIG claim settlement time lines are now the industry benchmarks. Our global presence also provides customers with claims servicing and settlements by a local office of AIG in over 130 countries of the world. Our servicing in exports is not dependant on external third party providers. We also have in our midst, the expertise of marine recoveries which help in minimizing losses.

Be With The Leader

Globally AIG is among the world's largest cargo insurers. In India, we have been the market leaders among the private players by far. The numbers speak for itself.

Cargo Premium is Rs. in Croers

45 40

Tata AIG General

35 30

ICICI Lombard

25 IFFCO Tokio

20 15

Bajaj Allianz

10 5

Royal Sundaram

0 2002 - 2003

2003 - 2004

2004 - 2005

Source : IRDA Journals

Tata AIG The Marine Specialist Tata AIG is the only Insurer in the market, having a dedicated team of marine underwriters in all the branches of the company; experts who understand your business and provide you with customized solutions at the most competitive rates. In the complex world of trade and commerce,

Trust the Specialist.

Insurance is the subject matter of the solicitation.

AIG

INSURANCE

WITH YOU ALWAYS

Tata AIG General Insurance Company Ltd. Registered Office : Peninsula Corporate Park, Nicholas Piramal Tower, 9th Floor, Lower Parel, Mumbai - 400 013. T:+91 22 5669 9696 F:+91 22 5654 6464 www.tata-aig.com