Florida 2-20 General Lines Agent (Property, Casualty, Commercial Lines and Florida Law)Commercial LinesEasy
A shipping company is preparing to transport a large cargo of electronics from Miami to Liverpool via ocean vessel. They are concerned about potential losses during transit, including perils of the sea, jettison, and general average contributions. Which type of insurance is specifically designed to cover these risks?
- ACommercial General Liability Policy
- BInland Marine Policy
- CCommercial Property Policy
- DOcean Marine Policy
Show answer & explanationAnswer & explanation
Correct answer: D. Ocean Marine Policy
Ocean Marine insurance is specifically designed to cover risks associated with marine transportation, including perils of the sea, jettison, and general average contributions for cargo, hull, and freight.
Why the other options are wrong
- A. Commercial General Liability covers third-party bodily injury and property damage, not loss of cargo itself.
- B. Inland Marine covers property in transit over land or on inland waterways, not ocean voyages.
- C. Commercial Property covers stationary property at a fixed location, not cargo in transit across the ocean.
Ocean Marine Insurance
Ocean Marine insurance covers perils associated with transportation by sea, including damage to the vessel (hull), cargo, and potential loss of freight revenue.
- Covers perils of the sea.
- Includes Hull, Cargo, Freight, and Protection & Indemnity (P&I) coverages.
- Often includes General Average provisions.
Memory trick: If it's 'Ocean' and 'Marine', it's 'Across the Sea' for 'Cargo' and 'Ship'.