The one shipment nobody declared
sails uninsured

1. Where per-shipment cover leaves gaps

The hardest marine cargo losses are rarely arguments about scope of cover. They are the shipments that had no certificate at all. Under per-shipment declaration, the act of shipping and the act of insuring are performed by different people at different moments, so they can structurally fall out of step.

• The person is away, or has changed — when the routine depends on one individual's habits, holidays, resignations and handovers produce omissions.
• The invoice value is revised upward later — once the certificate is fixed at the value known when it was filed, a later increase leaves the difference under-insured.
• The sailing schedule moves — if the vessel leaves before the declaration is filed, insurers may restrict cover taken out after transit has begun.
• Shipments outside business hours — while issuance waits for the next working day, the goods are already moving.
• Nobody knows at the time — this is what the situations above have in common. The omission surfaces only when a loss occurs, or at reconciliation.

The point. The problem is not that mistakes happen. It is that a mistake immediately changes whether cover exists. An Open Policy breaks that link.

2. Per-shipment cover vs Open Policy — structural comparison

How the same situation is handled under each structure.

The comparison above sets out the general structural difference. The actual attachment point, scope and limits follow the individual agreement and the insurer's policy wording.

4. What you must know — the declaration duty

An Open Policy should not be understood as "every shipment is handled automatically". Attachment of cover and the declaration duty are separate obligations, and the following remain the policyholder's to manage.

• Agreed scope — whether the commodity, the route and the mode of carriage fall inside what was agreed.
• Limits — whether any per-sending, per-conveyance or per-location limit is exceeded.
• Values — whether the declared value matches the actual invoice value.
• Declaration cycle — whether declarations are made within the agreed interval (usually monthly).
• Shipments outside scope — whether a new route, a new commodity or a high-value single sending needs to be agreed in advance.

To be precise. The declaration is the procedure for premium settlement and notice. However, the treatment of a missed declaration, the extent to which late declaration is permitted, and how deliberate non-declaration is dealt with all vary by the insurer's wording and by the individual agreement. Fixing the agreed scope and the declaration procedure in writing at inception is therefore the practical heart of the matter.

5. Cargo suited to an Open Policy

The more repetitive the commodity and the more consistent the route, the easier it is to define the agreed scope precisely.

• Raw materials and components
• Machinery and parts
• Electrical and electronic goods
• Textiles and apparel
• Chemical products
• Appliances and household goods
• Food and agricultural produce
• Furniture and interior goods

Hazardous or perishable commodities, high-value single sendings, and routes touching sanctioned territories require separate discussion. Acceptance and terms are confirmed after the insurer's underwriting review.

6. Documents required when a loss occurs

Claims handling under an Open Policy follows the same route as under an individual certificate. The more complete the file, the faster the adjustment.

• Commercial Invoice — establishes value
• Packing List
• B/L or AWB
• Master policy and certificate for the shipment concerned
• Declaration record for that shipment
• Photographs of the damage and of the packing
• Delivery Receipt
• Survey Report
• Notice of Loss served on the carrier, with evidence of despatch

Whether the file is complete often decides the outcome at the adjustment stage. Notice to the carrier in particular is time-barred from the date of delivery, so it should be served as soon as damage is discovered.

7. Review thresholds

Size alone does not decide it. Commodity, route, shipping frequency and loss history are considered together. In practice, the figures below are the starting point for a review.

If the size threshold has kept you from looking at an Open Policy at all, it is worth a second look. Where the commodity and the route are consistent, a workable structure is sometimes possible at a smaller premium volume. Acceptance, rating and cover terms are confirmed after the insurer's underwriting review.

8. How it proceeds

1. Step 1 · Review the present position — we look at the current certificates and the recent settlement record or shipment list, and reconcile the number of shipments against the certificates issued to find the gaps.
2. Step 2 · Define the agreed scope — commodity, route, mode of carriage and limits are fixed, together with how shipments outside that scope will be handled.
3. Step 3 · Underwriting — terms are put to six insurers and acceptance is established.
4. Step 4 · Agreement and transition — the switchover is timed against the expiry of the existing certificates so no gap in cover opens up.
5. Step 5 · Running it — monthly declaration and settlement. If a loss occurs, we support the adjustment and claim process.

9. Frequently asked questions

Does an Open Policy mean every shipment is automatically covered?

Cover attaches to shipments falling within the agreed scope — commodity, route, mode of carriage and limits. Cargo or routes outside that scope, and shipments exceeding the limits, are matters for separate agreement, and the treatment of a missed declaration depends on the insurer's wording. Fixing the agreed scope clearly before inception is what matters.

If I forget to declare, am I uninsured?

Under an Open Policy the declaration is the procedure for premium settlement and notice. However, the treatment of a missed declaration, the extent to which late declaration is permitted, and how deliberate non-declaration is handled vary by wording and by agreement. In practice we recommend putting a monthly batch declaration routine in place.

What is the single biggest difference from per-shipment cover?

The trigger for attachment. Per-shipment cover turns on a person filing; an Open Policy turns on the fact of shipment within the agreed scope. That difference is what changes the outcome when a member of staff is away, a handover is incomplete, a schedule moves, or a shipment goes out after hours.

What happens if the invoice value goes up later?

Under per-shipment cover the sum insured is fixed at the time of filing, so a later increase can leave the shipment under-insured. An Open Policy can be structured to capture the final value at the declaration stage. Treatment of any amount above the agreed limit follows the terms of the agreement.

How large does a programme need to be?

We review an Open Policy structure from an annual marine cargo premium volume of about KRW 2 million. Size alone does not decide it — commodity, route and loss history are considered together. Acceptance and terms are confirmed after the insurer's underwriting review.

We already place with another insurer. Can we move?

Yes. The expiry of the existing certificates, any open losses and any outstanding declarations need to be settled first so the transition leaves no gap in cover. That is why we review the current certificates together with the recent settlement record.

How are documents issued?

A master policy is issued first. Where an individual document is needed — for a letter of credit, for example — a certificate is issued for that shipment. The form required can differ by the terms of the credit, so it is worth confirming in advance.

Is the brokerage commission payable by us?

No. Our commission is paid by the insurer and is not added to the premium payable by the policyholder, in accordance with Article 98 of the Insurance Business Act (prohibition on the provision of special benefits).

Related lines

• Marine Cargo — ICC clauses, Incoterms and commodity-specific conditions.
• Inland Transit — closes the inland leg from factory to load port.
• Transit Insurance (domestic) — loss or damage during domestic road, rail and coastal carriage.

For a one-off or irregular shipment, the marine cargo estimator gives an indicative range first. The actual premium is confirmed after the insurer's underwriting review.