When you’re getting started in international trade, it is advisable that you insure your goods; this will give you peace of mind in the event of shipment damage or loss.
There are a couple of types of insurance to consider, below is a summary of each:
Export credit insurance
To protect your company against non-payment, it’s important to insure your export orders, even if your customer is a well-known or reputable company in a low-risk country. Your chosen insurance company will cover the payment risks involved in international trade.
The very nature of exporting and importing means that goods can be in transit for a number of days, with the unfortunate risk of damage, loss or delay. Most international carriers take great care to minimise such risks. It’s sensible to insure your goods according to their value so that you are sufficiently covered in the event that something goes wrong. Cargo insurance covers loss or physical damage to goods whilst in transit, and covers transportation by air, road, rail and sea. You can get more comprehensive cover to protect against specific incidents, such as theft or damage during loading. The Incoterm® 2010 specified in your contract of sale will determine who is responsible for arranging this cover. As the exporter, you are obliged to arrange insurance cover under Incoterm® 2010 rules CIF and CIP. In such cases you should build this cost into your quotation.