Annual Open Marine Insurance Policy India Guide

Annual Open Marine Insurance Policy

Short answer: An annual open marine insurance policy is a single 12-month contract that automatically covers every shipment you declare during the year — sea or air, export or import — without arranging a new policy each time. You still declare each shipment before dispatch, but the rate, clause, and paperwork are fixed in advance.

How an Open Policy Works

Instead of buying a fresh policy for every shipment, you sign one open policy covering the full year. Each shipment is then declared — value, cargo, route, mode of transport — before it leaves your warehouse. The policy's pre-agreed clause and rate apply automatically to that declaration. Premium is calculated per declared shipment and typically settled monthly or quarterly, not as one lump sum upfront.

Core Coverages Included

• Institute Cargo Clauses (A) — all-risks cover, the broadest standard clause for sea cargo
• Institute Cargo Clauses (B) / (C) — named-peril alternatives where a lower premium is preferred for lower-risk cargo
• Institute Cargo Clauses (Air) — all-risks cover for air freight shipments under the same open policy
• Warehouse-to-warehouse cover — protection from the point of dispatch at your factory through to final delivery, not just port-to-port
• 110% CIF valuation as standard — sum insured reflects cost, insurance, freight, and anticipated profit margin, not just invoice value

Available Add-Ons & Extensions

• War Risk (Institute War Clauses) — covers war, hostilities, and related perils; must be arranged before the vessel or aircraft departs
• Strikes, Riots & Civil Commotion (SRCC) — covers loss from labor unrest and civil disturbance en route
• Institute Theft, Pilferage & Non-Delivery (TPND) — specific cover for theft and short-shipment risk, useful for high-value or easily resold cargo
• Increased Value clause — additional cover layered on top of the base sum insured when cargo value rises after the original declaration
• Breakage & leakage extension — relevant for tiles, glass, powders, and liquid or granular cargo prone to in-transit breakage
• Temperature & humidity extension — for moisture-sensitive minerals, textiles, or perishable goods
• Debris removal cover — costs of removing damaged or wrecked cargo after a covered loss
• Duty and increased cost of working extensions — covers customs duty already paid on cargo that is later found damaged or lost

Risks Typically Covered

• Fire, explosion, and vessel or aircraft casualty (sinking, grounding, collision, crash)
• General Average contribution and salvage charges
• Water damage, including seawater ingress and rain during handling
• Mishandling during loading, unloading, or transshipment
• Theft, pilferage, and non-delivery of entire packages
• Jettison and washing overboard (sea cargo)

What's Not Covered (Standard Exclusions)

• Inherent vice or nature of the goods (e.g., natural deterioration)
• Insufficient or unsuitable packing
• Ordinary wear, tear, and loss in weight or volume
• Delay, even where caused by an insured peril, unless specifically extended
• Willful misconduct of the insured
• Insolvency or financial default of carriers, unless a specific extension is purchased

Timing: What Must Happen Before Dispatch

An open policy removes repeat paperwork, but it does not remove the timing rules. Standard cargo cover must still be declared before goods leave the warehouse. War Risk and SRCC extensions must be arranged before the vessel or aircraft departs — once transit has begun, these two covers cannot be added, regardless of how the base policy is structured.

Open Policy vs Specific (Single-Transit) Policy

Why Exporters Choose an Open Policy Through CargoCover

• One named advisor across all declarations and claims — no re-explaining your business each shipment
• Correct clause and add-ons matched to your specific commodity, not a generic default
• Declaration and documentation support so nothing is filed late or incorrectly
• Faster claims handling, backed by pre-agreed terms instead of re-negotiation at the time of loss

Frequently Asked Questions