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Theft, Pilferage & Non-Delivery (TPND) Clause — Marine Cargo Add-On Cover | CargoCover Advisory

What Is the Theft, Pilferage & Non-Delivery (TPND) Clause?

The Theft, Pilferage & Non-Delivery (TPND) Clause is a vital marine insurance add-on that covers the partial loss of cargo caused by opportunistic stealing, missing individual cartons, or short-delivery during transit. It forces the policy to respond to small-scale, hidden theft, rather than just total container losses.

Why Is the TPND Clause Missing From Standard Marine Policies?

Standard Institute Cargo Clause A (All Risks) policies seem comprehensive on paper, but claims involving missing items frequently stall during settlement. If a container arrives at its destination with its original seal apparently intact but missing ten cartons inside, insurers often deny the claim. They routinely classify the loss as an "unexplained shortage" or an inventory error rather than a transit theft event, unless a dedicated TPND clause is explicitly named in the policy.

What Exactly Does the TPND Clause Cover?

• Partial Pilferage: The stealthy removal of individual items, packages, or cartons from inside a consolidated shipment.

• Non-Delivery: Situations where a specific portion of a consignment fails to arrive at the destination warehouse, even if the main container is delivered.

• Multi-Leg Protection: Theft occurring during any part of the journey, including factory loading, inland road transit, port handling, or customs storage.

• Seal Discrepancy Neutralization: Ensures coverage even when a container seal appears unbroken, protecting against sophisticated port-side tampering.

How Does a TPND Claim Play Out in the Real World?

An Indian textile exporter shipped a full container load (FCL) of premium branded garments from a manufacturing facility to a buyer in Europe. When the buyer opened the container at their destination warehouse, the outer customs seal looked perfectly intact. However, three full pallets containing high-value retail cartons were completely missing from the back of the container.

The Dispute: The insurance surveyor pointed to the intact seal and argued that the shortage must have happened due to a miscount at the factory before loading, rejecting the claim as an unproven theft event.

The Resolution: Because CargoCover had attached a dedicated Theft, Pilferage & Non-Delivery (TPND) Clause, the policy was legally bound to recognize partial missing cargo as an insured loss. The claim was settled based on the cargo weight discrepancies recorded between transit toll points, bypassing the insurer's "intact seal" loophole.

Which Indian Exporters Need This Insurance Add-On Most?

Cargo theft rarely happens as a dramatic full-truck hijacking; it happens quietly, carton by carton, during port terminal storage or border crossings. This add-on is mandatory for businesses exporting high-value, easily liquidable items where individual units hold independent retail value:

How to Restructure Your Marine Coverage with CargoCover

CargoCover Advisory seamlessly integrates specialized clauses into your logistics framework using a structured four-step workflow:

1. Trade Route Analysis: We assess your specific commodity value, packaging security (like tamper-evident taping), and transit risk zones.

2. Premium Benchmarking: A detailed policy review comparing your current deductibles and coverage boundaries against live market pricing.

3. Policy Restructuring: We rebuild your policy under Institute Cargo Clause A, ensuring TPND, War, and SRCC are fully embedded.

4. Active Claims Support: Complete management from immediate surveyor deployment to documentation filing for a swift claim payout.

🌐 Connect with CargoCover Advisory

CargoCover Advisory is an authorized ICICI Lombard marine insurance agency dedicated to securing international trade for Indian exporters, importers, and Custom House Agents (CHAs). Every Marine Open Cover policy we structure is backed by 110% of the CIF invoice value as standard to fully cover your duties and freight costs.

• 📧 Direct Email: cargocoverindia@gmail.com

• 🌍 Main Hub: CargoCover India Official Site

• 💼 B2B Network: CargoCover Advisory on LinkedIn

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