Inland vs Ocean Marine Insurance: A Comprehensive Guide for Indian MSMEs

What surprises many business owners is that inland marine insurance has nothing to do with water. It was originally named that way because it evolved from ocean marine insurance, but now it covers land-based transit and equipment. However, together, inland and ocean marine insurance complete the trade cycle. When a product moves from India to Europe, inland marine insurance protects it from the factory to the port, while ocean marine insurance takes over from the port tothe  port. This coordination ensures unbroken coverage across the entire trade chain.

Read this guide to understand the difference between inland and ocean marine insurance. For comprehensive MSME insurance policies, explore Bajaj General Insurance’s marine insurance policies that offer complete protection within the country and overseas.

What Is Marine Insurance?

When enterprises like shipowners and traders transport goods, they purchase a marine insurance policy to protect their goods and ship from the risks involved in transporting goods from one place to another. While purchasing the policy, they need to pay a premium to insurance companies, which promise to compensate the insured in case of losses.

Thus, a marine insurance policy is a type of commercial insurance policy that protects businesses throughout the supply chain and is applicable to goods on land or at sea. This policy is very important to the following entities:

●       Shipping companies: A marine insurance policy safeguards vessels, onboard machinery, and even cabin furnishings in case the ship suffers accidents like fire or collisions.

●       Exporters: When exporters ship their goods, this policy protects their merchandise from risks like theft and damage.

●       Consignees: Buyers who are responsible for shipping can protect the payments they have already made. With an insurance policy, they do not lose money if goods get damaged during transit.

●       Freight carriers: Freight carriers are responsible for the transit of cargo. If the goods are lost or damaged during transit, the insurer helps in compensating for the loss so that they are not left alone to bear the loss.

What is Inland Marine Insurance?

Inland marine insurance protects goods and equipment when you move them from one place to another within the country by road or rail. This type of insurance also covers items that are stored temporarily at off-site job locations. This

Key features are:

●        Inland marine insurance is useful to protect tools and machinery, and other valuable goods when they are being transported or even when construction materials are stored at a different location for a temporary period.

●        Property insurance is designed for assets that are stored within your business premises. But what about assets that are in transit or stored at the place of the job operation? This coverage gap is filled by inland marine insurance.

●        Inland marine insurance provides coverage against various risks like fire, theft, damage and accidents.

Who should buy it?

●        This type of policy is ideal for building contractors who frequently move construction tools and machinery between project sites.

●        Manufacturers need to transport finished goods to distributors or warehouses. Inland marine policy is suitable for them as well.

●        Exhibition organisers who move display items or equipment between venues can benefit by purchasing this policy.

●        It can also prove advantageous for service-based MSMEs that use portable equipment like diagnostic tools or electronics across multiple locations.

What is Ocean Marine Insurance?

Ocean marine insurance is important for international trade; it protects the goods that are being transported by sea or ocean and also the ships that carry these goods. If an accident damages another ship during the voyage, then the owner is held responsible. This type of insurance covers the legal liabilities of the owner also.

The main types of coverage are:

●       Marine cargo insurance: This type of policy protects the goods that are transported by sea from the time they are loaded till the time they are unloaded at the destination port. It provides coverage against losses caused by storms, fire, piracy, etc.

●       Marine hull insurance: It covers the body of the ship and the machinery as collisions and accidents can damage the ship. So, shipowners take this insurance so that their ship can be repaired and they do not face financial loss.

●       Liability insurance: If the vessel causes harm to others during the voyage, ship owners and operators face legal liabilities. This insurance protects them from legal consequences.

Who should buy it?

Ocean marine insurance is essential for:

●        Exporters and importers who send and receive goods through sea routes.

●        Vessels and crew are protected with the help of this policy, hence ship owners and operators also require it.

●        Logistics companies that are involved in managing sea transportation are also benefited.

Conclusion

Indian MSMEs that source raw materials from far away places or export their products to other countries face an increased risk due to the perils of sea. At such times, a marine insurance policy is essential to protect them from financial losses. A strategic combination of both the policies is a good decision to ensure complete protection.

Bajaj General Insurance’s integrated marine insurance solutions make it easy for MSMEs to protect domestic and international shipments efficiently. For more details on marine insurance policies, visit Bajaj General Insurance today.

FAQs

1. Do I need both inland marine and ocean marine insurance?

Yes, if your goods are transported domestically before sea shipment, both policies together ensure end-to-end protection.

2. Can one policy cover both inland and ocean stages?

Yes—multimodal transit policies can be structured to provide seamless coverage across land and sea.

3. What is the difference between ITC-A and ICC-A clauses?

ITC-A covers all inland transit risks except rainwater damage; ICC-A covers sea transit risks with similar breadth.

4. Is liability insurance included in marine cargo insurance?

Marine cargo cover handles cargo and goods. Liability cover is separate and covers third-party risks and legal exposure.

5. Will my standard business insurance cover machinery in transit?

No, standard commercial policies typically exclude transit or offsite assets—making inland marine insurance essential for mobile equipment.

6. How are premiums calculated for marine insurance?

Premiums depend on cargo value, journey length, transit mode, chosen clause (all-risk vs named), historical loss experience, and insurer assessment.

*Standard T&C apply

**Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.

***Disclaimer: The content on this page is generic and shared only for informational and explanatory purposes. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making any related decisions.