ONE Apus And Insurance
After more than four months, the ONE Apus finally arrived and departed the Port of Long Beach. Caught in a storm on November 30, 2020, approximately 1600 nautical miles northwest of Hawaii, the ship lost more than 1800 containers overboard and diverted to Kobe, Japan, for evaluation and assessment. The vessel reached Kobe on December 8th, kicking off insurance investigations, repairs and the general cleanup and the maintenance that naturally comes after not just containers being swept overboard but the collapse of several stacks on deck. In a banner year for cargo mishaps overseas, the ONE Apus stands alone atop the leaderboard with other losses far behind.
In a typical year, only 1,300 containers are lost on the sea among the 5,000 ships traveling with cargo, so with the wild number of issues in 2020, the idea of cargo insurance is timely and necessary. While General Average wasn’t declared in the ONE Apus situation, we’re all acutely aware of the term now after the Ever Given Suez spectacle early this year. In that case, the ship was arrested and impounded pending a $600 million dollar insurance claim, down from the initial $916 million they sought in the days after she was freed.
These instances are rare huge examples of the things that can go wrong, but protecting your cargo is critical even when the seas are smooth. Protecting your cargo from accidents and Acts of God means more than just being ready for a once in a lifetime calamity at sea. Cargo insurance is a highly specialized policy that covers cargo owners from a named origin to a named destination by agencies who understand the intricacies of maritime responsibility in an occurrence.
Cargo insurance is also a necessity because carriers impose limitations of liability. In the case of ocean freight, they cap their risk at $500 per declared package. Depending upon both the cargo and the number of declared pieces, a shipper could be left woefully undercompensated in a claim.
TOC Logistics can offer importers and exporters cost-effective solutions for cargo across modalities that ensure when limits of liability imposed by the conveyance owners are insufficient to cover a loss, cargo insurance can make an insured party whole.
Because cargo varies wildly from one shipper to another, working with a professional who understands the needs of cargo owners means having a partner to work with the requirements specific to the individual commodities, values, destinations and carriers on a voyage. Being caught unprotected can result in huge financial losses beyond the cost of the cargo you’re shipping; a General Average declaration requires all parties to bear responsibility for the lost cargo, not the carrier, and not just for the shippers particular cargo on board.
If your container of unsharpened pencils is on a ship that loses a dozen containers worth of diamonds, your portion of responsibility will be far greater than just the value of your cargo. Adequate insurance coverage underwritten by a reputable company keeps that nightmare from awakening our clients at night. Take the time today to reach out to your TOC Logistics account manager to learn more about adding cargo insurance to your shipments, even after they are already in transit. We want to protect your cargo; let us show you how to get started.
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