1. Core concepts of international freight insurance
International freight insurance refers to the behavior that the insured (exporter or importer) insures certain risks from the insurer (insurance company) for its goods in transit at a certain amount and pays INSURANCE CHARGE. When the goods encounter insured risks and suffer losses during transportation, the insurer is responsible for making financial compensation to the insured.
Essence: Transform unforeseen and potential losses in the process of transportation into certain and affordable expenditures by paying fixed premiums (costs), thus realizing the transfer of risk and financial stability.

2. Types of risks and losses covered
Main Risks
• Maritime risks: natural disasters (e.g. bad weather, lightning), accidents (e.g. ship grounding, collision).
• External risks: general external risks (e.g. theft, broken, moisture), special external risks (e.g. war, strike, rejection).
Type of loss
• Total loss: actual total loss (complete loss of the goods), presumed total loss (repair cost exceeds the value of the goods).
• Partial loss:
◦ General average: the special sacrifice or special expenses directly caused by the master's intentional and reasonable measures in order to relieve the common danger shall be shared proportionally by the ship, the cargo and the freight.
◦ Separate average: A partial loss that belongs only to a specific interested party and does not involve a common danger.

3. Special risks and additional risks
Basic insurance (All Risks/ICC (A)) does not cover all situations, and the following common risks require additional insurance:
• War risks
• Strike insurance
• Rejection insurance: Especially suitable for sensitive goods such as agricultural products, food, and medicines.
• Terminal inspection clause: Extension of insurance liability to destination terminal.
• Temperature and humidity related risks: for cold chain goods.

4. Practical suggestions for importers and exporters
1. Don't be lucky: there are many links and high risks in international transportation, and the loss of one uninsured ticket may devour the profits of dozens of tickets.
2. Clarify contract responsibilities: clearly stipulate who will insure, the type and amount of insurance in the trade contract to avoid disputes.
3. Full insurance: insure at 110% of the CIF price to ensure that costs and reasonable profits can be covered.
4. Timely notification and evidence collection:
◦ The buyer shall self-insure immediately upon receipt of the shipment notice under FOB/CFR.
◦ When the goods are damaged, inform the insurance company and carrier as soon as possible, and take photos and videos on the spot for evidence collection.
5. Declare truthfully: Do not conceal or misreport the goods information, otherwise the insurance company may refuse to pay compensation.
6. Choose reputable insurance companies and freight forwarders: They can provide professional insurance advice and efficient claims support.
Summary: International freight insurance is International's "safety belt". Understanding its core rules and making good use of them are essential skills for every foreign trade practitioner to control risks and protect their own interests.

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