Insurance claims settlement in CIF terms

[Rahul Sonawane]

Dear All,

We are supposed to send one export shipment on CIF terms. Our customer is asking to arrange the insurance having the words mentioned in that the claim shall be payable in the Customers Country.

But Insurance companies has denied to mention this word ' claims payable at Srilanka '

Now my question is that.

1) Is it possible ?

2) Once cargo is unloaded at destination port , thereafter it shall be carried to CFS, and after opening at CFS only, one can come to know about the damage of cargo if any. In this situation whether the Insurance policy under CIF terms shall cover the damage ?

3) Who will receive the claim amount from Insurance company , customer or shipper ?

[MUKUND THAKKAR]

Dear Rahulji,

Insruance company covered the risk up to delivery of customer place with additional charges. every insurance company have connectivety by way of branches as well as tie up with other aganecy. so possible claims payable at Srilanka.

2) Once cargo is unloaded at destination port , thereafter it shall be carried to CFS, and after opening at CFS only, one can come to know about the damage of cargo if any. In this situation whether the Insurance policy under CIF terms shall cover the damage ? yes, but subject to risk of transit damages also cover in policy.

3) Who will receive the claim amount from Insurance company , customer or shipper ?

Your customer, insurance charges is inclusive in CIF terms.

[Ganeshan Kalyani]

Sir, if the responsibility is yours till the material reaches the customer port then you would do insurance. So the cost become CIF I.e. insurance is borne by you along with freight.

Further, If any damage happens to the material before reaching the customer port who is responsible, it is on your account or customer responsibility. These things need to be checked first. Thanks.

AI Summary

Insurance under CIF terms: seller-arranged transit cover can be payable in buyer's country, subject to insurer agreement and policy terms. Under CIF (cost, insurance and freight) terms the seller procures and pays for transit insurance to the named destination; insurers can often arrange local payment through branches or agents so claims payable in the buyer's country may be possible with additional charges. Transit insurance under CIF is intended to cover loss or damage during carriage and after unloading into CFS, subject to the policy's insured risks. Insurance cost is borne by the seller, and the party holding the insured interest (typically the buyer after risk passes) is normally the practical recipient of any settlement, subject to insurer procedures.