Cargoes Requiring Special Consideration
Some types of cargo are considered as presenting an unacceptably high risk. However some of these high risks can be quite acceptable depending on the voyage and the standards of security and infrastructure in the territory concerned.
Aid Shipments
These cargoes can comprise bulk shipments of foodstuffs but also items of infrastructure intended to rebuild an area after a natural disaster or war. The problems can be summarised as follows:
- Poor quality, often older, tonnage is used giving rise to risk of total loss of vessel.
- Goods may be of poorer quality as prices paid for them are minimal.
- Goods may be short loaded at commencement of voyage.
- If law and order has broken down at destination pilferage can be a major problem.
- If port facilities are in poor condition goods may be short landed or become easily damaged.
Fishmeal/Fertiliser
This commodity is particularly susceptible to spontaneous combustion and it is necessary to constantly monitor the temperature of the stack both before loading and whilst on board the carrying vessel. The sophistication of the ports of loading and discharge is very relevant to ensure that proper monitoring is carried out. If underwriters are sure that this is acceptable and regular surveys are undertaken then the risk can be successfully written.
A further problem with this cargo is that it rots very rapidly following contact with water and becomes a total loss.
Furs, Hides and Skins
These commodities can be carried in several different ways which require different methods of carriage. The main problems can be summarised as follows:
- Different levels of preparation may cause different rates of deterioration if in contact with moisture.
- Hook damage or similar can cause a total loss.
- Hair slip on furs (bald patches) can render the whole pelt unusable.
- Some pelts are extremely valuable and are especially targeted by thieves.
Fresh Fruit
For relatively short journeys in temperate climates fresh fruit, if picked at the correct time, can be transported satisfactorily but there are a number of dangers:
- Thorough ventilation is required at all times to prevent over ripening.
- Fruit can be damaged by parasites during the voyage.
- Fruit can be bruised when picked but this may only become apparent after voyage.
- Ventilation must be provided to allow the free passage of air through the cargo.
- Gases given off by overripe fruit will hasten the deterioration of the sound cargo.
- Edible and delicate cargo will be damaged if stowed in proximity to fresh fruit.
Heavy Lifts and Abnormal Loads
This type of cargo can be written successfully but requires the appointment of qualified and experienced cargo surveyors to be in attendance to supervise the handling, loading and discharge of the cargo at the various critical points during the transit.
It is important to ensure that the carriers and ship operators appointed by the cargo owners have:
- the required level of expertise
- proper, suitable and appropriate cargo handling equipment and resources to perform their duties correctly.
- a vessel suitable and appropriate for the safe carriage of the cargo.
Household Goods and Personal Effects
This cargo can be underwritten successfully but it suffers from the following problems:
- Low values at risk therefore premiums generated tend to be low in relation to the amount of work required.
- There can be a high incidence of claims due to habitually high quantities of fragile goods involved.
- Underwriting and claims servicing is usually very labour intensive.
- Companies offering this class as an oblige extension to annual household policies have forced premium rates down to low levels.
Liquor
This commodity can be underwritten profitably but it very much depends on the sophistication of the loading and discharge areas and the care taken with the carriage. The main problems can be summarised as follows:
- High risk goods particularly targeted by thieves.
- Risk of breakage of bottles
In territories with good security and proper handling these risks are minimised and it may be possible to underwrite the business profitably, perhaps with the inclusion of a deductible. This will especially be the case if the goods are containerised which will minimise external contact damage to packaging and prevent pilferage.
Mobile Phones and Phone cards etc
- Extremely high theft risk from organised and opportunist thieves.
- Very high value in small volume makes them easy to carry away.
- Easily damaged if not handled correctly.
- Any damage to an item will usually result in a claim for total loss.
Precious Metals, Stones etc
These commodities are customarily underwritten in the well established marine insurance markets where there is plenty of capacity as the values at risk are usually extremely high. The main considerations for these types of good are:
- Small sized commodities with extremely high values
- Easily pilferable if proper precautions are not taken
- Security measures taken may not deter thieves who may be well prepared
- Security companies used may be infiltrated by thieves
Raw Cotton
This commodity is usually shipped in bales covered in hessian or gunny cloths but suffers from several serious problems:
- The risk of spontaneous combustion is very high
- Wet cotton will heat and deteriorate if stowed in a confined space
- Cotton may suffer from country damage prior to loading
Tobacco/Cigarettes
These risks can be profitably underwritten but conditions in different territories, and even particular regions, can be dramatically different. The principle problems are:
- Highly desirable commodity for thieves - not just pilferage but organised hijacking etc.
- Easily damaged during loading/unloading and storage if incorrectly handled.
- Goods can be totally lost if they sustain wet damage.
- Extremely combustiable.
