What is Marine Cargo Insurance?
Marine Cargo Insurance is a policy that protects goods in transit against risks such as theft, loss, or damage while being transported via sea, air, or land. It ensures businesses, importers, exporters, and logistics companies are financially safeguarded from unforeseen perils.
In Kenya, Marine Cargo Insurance is regulated by the Insurance Act (Cap 487) and is mandatory for all imports, as per a directive by the Kenya Revenue Authority (KRA) and the Insurance Regulatory Authority (IRA).
100%
Mandatory for all imports to Kenya
KES 1B+
Annual cargo claims in Kenya
24/7
Claims support & emergency assistance
What Does Marine Cargo Insurance Cover?
| Coverage Type | Description |
|---|---|
| Loss or Damage to Goods | Covers goods damaged during transit due to accidents, theft, fire, or natural disasters. |
| Theft & Piracy | Protects against cargo theft, piracy, and hijacking. |
| Sinking or Collision of Vessel | Covers goods lost due to shipwrecks or collisions. |
| Fire & Explosion | Covers damage caused by fire or explosions during transit. |
| Weather-related Damage | Protects goods from damage due to storms, hurricanes, and floods. |
| Loading & Unloading Risks | Covers damages that occur during loading and unloading. |
Types of Marine Cargo Insurance
Open Cover Policy
Suitable for businesses with frequent shipments. Covers all shipments within a specified period.
Specific Voyage Policy
Covers a single shipment from origin to destination. Ideal for one-time imports or exports.
Contingency Insurance
Protects exporters if the buyer fails to insure goods properly. Ensures compensation coverage.
All-Risk Policy
Comprehensive coverage against all risks except specifically excluded perils.
Named Perils Policy
Covers only risks specifically listed in the policy document.
Warehouse to Warehouse
Coverage from seller's warehouse to buyer's warehouse, including all transit points.
Why is Marine Cargo Insurance Important?
- Legal Requirement – All imports to Kenya must be insured by a local insurance company.
- Financial Protection – Prevents losses due to damaged or lost goods during transit.
- Business Continuity – Ensures uninterrupted trade operations despite transit issues.
- Risk Mitigation – Protects goods from marine, air, and inland transit risks.
- Peace of Mind – Ensures compensation in case of accidents or losses during shipment.
Legal Requirement
The Kenya Revenue Authority (KRA) requires all imports to have Marine Cargo Insurance from a Kenyan-registered insurer. Without valid insurance, your goods cannot clear customs at Kenyan ports.
Marine Cargo Insurance Exclusions
Marine Cargo Insurance does not cover:
Intentional Actions
- Willful misconduct or fraud by the insured
- Intentional damage to goods
- Illegal activities
Product Issues
- Inherent defects in the goods
- Perishable goods decaying naturally
- Inadequate packaging leading to damage
External Factors
- Delay-related losses
- War and nuclear risks
- Customs confiscation
Cost of Marine Cargo Insurance in Kenya
The cost of Marine Cargo Insurance is determined by:
Goods Characteristics
- Nature of Goods – Fragile and high-value goods attract higher premiums
- Value of shipment
- Type of packaging used
Transport Factors
- Mode of Transport – Airfreight is less risky than sea freight
- Route & Destination – High-risk regions have higher premiums
- Transit time and distance
Coverage Details
- Coverage Type – All-risk policies are more expensive
- Deductible amount
- Previous claims history
Why Choose Laren Insurance Agency?
- Specialized expertise in marine cargo insurance for Kenyan importers and exporters
- Comprehensive risk assessment and cargo protection advice
- Access to multiple insurance providers for competitive pricing
- Quick and fair claims processing with dedicated cargo specialists
- Understanding of international trade regulations and customs requirements
- Customized coverage options for different cargo types and shipping methods
- Ongoing policy review and risk management support
- Regulatory compliance guidance with KRA and IRA requirements
Frequently Asked Questions
Yes, according to the Kenya Revenue Authority (KRA) regulations, all imports to Kenya must be insured by a Kenyan-registered insurance company. This is a mandatory requirement for customs clearance at Kenyan ports. The insurance must cover the goods from the port of loading to the final destination in Kenya.
An Open Cover policy is designed for businesses with regular shipments and provides continuous coverage for all shipments within a specified period (usually one year). A Specific Voyage policy covers a single shipment from origin to destination and is ideal for one-time or occasional shipments. Open Cover policies are more convenient for frequent shippers as they eliminate the need to arrange insurance for each individual shipment.
The insurance value is typically calculated as the Cost of Goods plus Insurance plus Freight (CIF value). This includes the invoice value of the goods, all shipping and freight charges, and the insurance premium itself. Some policies may also include a percentage markup (usually 10-15%) to cover anticipated profit and other incidental costs.
To make a claim, you typically need: the original insurance policy/certificate, commercial invoice, packing list, bill of lading/air waybill, survey report (if damage is visible), correspondence with carriers, and any other relevant documents supporting the claim. It's important to notify us immediately when damage is discovered to ensure proper documentation.
Standard marine cargo policies typically provide "warehouse to warehouse" coverage, which includes temporary storage at ports as part of the transit process. However, extended storage beyond a reasonable transit period may not be covered. If you require coverage for extended storage, we can arrange appropriate extensions to your policy.
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Get comprehensive Marine Cargo Insurance coverage tailored to your specific import/export needs. Our experts will help you find the right protection at competitive rates.