Technology has made the world a global village. You will agree that this has led to a boom in the import and export business. It may be challenging to run an import and export business. As a business owner, you worry about your goods’ safety and the credibility of the overseas companies you deal with. Getting import-export insurance will help ease this burden.
What is Import Expert insurance? This is a type of insurance coverage that involves goods that are transported from one country to another. It may be risky to run an import and export business. This is why you need comprehensive insurance coverage.
Importance of Import/Export Insurance
Insurance is necessary for any business. The risks involved in the import and export business are different from risks involved in any other business type. Cargo, vehicles, ships, containers, and planes are the key elements involved in this business. These come with a new facet of risk and profit damage.
An import-export business has unique risks. A lot of things can go wrong, making you incur huge losses. For instance:
• Your goods can get lost, damaged, or stolen while on transit
• Fire outbreaks
• Your employees can get injured while handling your goods
• Your goods can damage someone’s else’s cargo
When your goods are in transit, you have very little control over them. You cannot guarantee their safety. Moreover, if your goods accidentally damage someone else’s property, you may be required to pay.
Fire outbreaks are terrible. It’s even worse when the fire breaks out when your goods are in transit. An Import/Export insurance plan cushions you from such unfortunate scenarios.
Recommended Insurance Plans for Import/Export Business
The risks involved in the import and export business are unavoidable. Getting an insurance plan is a wise move to import and export safely, and protect your business from any unforeseen risks. Here are the required insurance plans for your business.
1. Export Credit Insurance
This is a prevalent form of export insurance. It is also referred to as trade credit insurance. This insurance cover is ideal for you if you offer credit to a foreign purchaser. An individual who buys goods on credit can fail to pay or become insolvent. This may be caused by several factors such as bankruptcy on their part.
While such incidences are unfortunate, they are unavoidable. However, an export credit insurance can return up to 90% of the total monies owed.
In addition to this, a credit insurance cover will provide crucial information to new sellers. New sellers are usually at risk of being scammed or conned. A buyer who is already deep in debt will most likely not be able to afford your goods. The insurer provides all financial information of the debtor.
Having export credit insurance is prudent for your business. You will sleep better knowing that your goods and profits are safe regardless of a new buyer’s financial state.
2. Product Liability Insurance
Sometimes, your products may arrive at their destination with flaws. Additionally, your products may not fully meet the local legal criteria. You risk losing your money and incurring huge losses.
An international product liability insurance will help you recover your money. This type of insurance covers you from risks resulting from litigation. It also covers the cost you incur when you fail to comply with the appropriate authority.
For you to enjoy this insurance plan, you need to adhere to the strict guidelines provided. Remember to carry out your due diligence. It is easier to comply with any rules and regulations related to your product’s sale in the market.
3. Marine Insurance
As opposed to what the name suggests, this insurance plan caters to goods carried across sea, air, post, or land. It is a complete insurance plan that covers your cargo from their point of departure up to when the buyer receives them.
Marine insurance covers you from risks such as loss of goods. While in transit, anything can happen. A plane can crash and a ship can sink. Nothing is predictable. A good insurance plan should cover your goods throughout the transit period.
Be careful to check that your policyholder can manage a claim globally. Note that this cover is restricted and common courier services lack professional marine insurance.
In conclusion, although the import-export business has a promise of lucrative returns, the risks are heavy. However, this should not deter you from being part of the Import/Export business. Consider investing in an excellent import-export insurance cover