Insurance

CMR Convention is an instrument of international private law adopted on 19 May 1956 governing the contractual relations for the international carriage of goods by road between the sender, the carrier and the consignee so CMR is a consignment notes which confirms the carrier has received the cargo and that a contract of carriage exists between the trader and the carrier.

The point is that this document has a kind of insurance with it. So while the carrier is responsible for any loss, damage or delay to the cargo until it is delivered, the trader is liable for any loss or damage the carrier suffers resulting from incorrect details having been provided in the CMR note.

 

Some of the information included in CMR:

• Exporter Details
• Consignee Details
• Goods Collection Details
• Goods Delivery Details
• Sender's Instructions
• Carriers Details
• Successive Carrier Details (in case of multiple carriers)

 

Iran is one of the countries which is a member of CMR convention so this gives the clients a peace of mind that their cargo transport is insured.

SMGS

The Agreement on International Goods Traffic by Rail (SMGS) became effective on November 1, 1951 and was managed by the Administration Bureau (AB) in Warsaw, Republic of Poland. This international conventions which apply in Eastern Europe and Asia to the international carriage goods by rail is a principal of agreement between the railways, consignor and consignee.

 

Some of the information included in SMGS:

• Exporter Details
• Consignee Details
• Carrier Details
• Goods description Details
• Station Which the Goods should Pass Till Destination

 

Cargo Insurance

According to the dangers which may exist for cargo in transportation, shipper or consignee may decide to use some kind of insurance to minimize the possible loss. Considering the type of transportation and possible dangers plus the sensitivity and value of the goods they can choose the type of insurance which should be used.

The most important types of insurances are clauses A, B and C, that you can see detailed information about them below:

 

INSTITUTE CARGO CLAUSES (A)

RISKS COVERED

Risks

1. This insurance covers all risks of loss of or damage to the subject-matter insured except as excluded by the provisions of Clauses 4, 5, 6 and 7 below.

 

General Average

 

2. This insurance covers general average and salvage charges, adjusted or determined according to the contract of carriage and/or the governing law and practice, incurred to avoid or in connection with the avoidance of loss from any cause except those excluded in Clauses 4, 5, 6 and 7 below.

 

"Both to Blame Collision Clause"

 

3. This insurance indemnifies the Assured, in respect of any risk insured herein, against liability incurred under any Both to Blame Collision Clause in the contract of carriage. In the event of any claim by carriers under the said Clause, the Assured agree to notify the Insurers who shall have the right, at their own cost and expense, to defend the Assured against such claim.

 

EXCLUSIONS

4. In no case shall this insurance cover

            4.1 Loss damage or expense attributable to wilful misconduct of the Assured

            4.2 ordinary leakage, ordinary loss in weight or volume, or ordinary wear and tear of the subject-matter insured

            4.3 loss damage or expense caused by insufficiency or unsuitability of packing or preparation of the subject-matter insured to withstand the ordinary incidents of the insured transit where such packing or preparation is carried out by the Assured or their employees or prior to the attachment of this insurance (for the purpose of these Clauses "packing" shall be deemed to include stowage in a container and "employees" shall not include independent contractors)

            4.4 loss damage or expense caused by inherent vice or nature of the subject-matter insured

            4.5 loss damage or expense caused by delay, even though the delay be caused by a risk insured against (except expenses payable under Clause 2 above)

            4.6 loss damage or expense caused by insolvency or financial default of the owners managers charterers or operators of the vessel where, at the time of loading of the subject-matter insured on board the vessel, the Assured are aware, or in the ordinary course of business should be aware, that such insolvency or financial default could prevent the normal prosecution of the voyage

This exclusion shall not apply where the contract of insurance has been assigned to the party claiming hereunder who has bought or agreed to buy the subject-matter insured in good faith under a binding contract

            4.7 loss damage or expense directly or indirectly caused by or arising from the use of any weapon or device employing atomic or nuclear fission and/or fusion or other like reaction or radioactive force or matter.

 

5. 5.1 In no case shall this insurance cover loss damage or expense arising from

            5.1.1 Unseaworthiness of vessel or craft or unfitness of vessel or craft for the safe carriage of the subject-matter insured, where the Assured are privy to such unseaworthiness or unfitness, at the time the subject-matter insured is loaded therein

            5.1.2 Unfitness of container or conveyance for the safe carriage of the subject-matter insured, where loading therein or thereon is carried out prior to attachment of this insurance or by the Assured or their employees and they are privy to such unfitness at the time of loading.

            5.2 Exclusion 5.1.1 above shall not apply where the contract of insurance has been assigned to the party claiming hereunder who has bought or agreed to buy the subject-matter insured in good faith under a binding contract.

            5.3 The Insurers waive any breach of the implied warranties of seaworthiness of the ship and fitness of the ship to carry the subject-matter insured to destination.

6. In no case shall this insurance cover loss damage or expense caused by

            6.1 war civil war revolution rebellion insurrection, or civil strife arising therefrom, or any hostile act by or against a belligerent power

            6.2 capture seizure arrest restraint or detainment (piracy excepted), and the consequences thereof or any attempt thereat

            6.3 derelict mines torpedoes bombs or other derelict weapons of war.

7. In no case shall this insurance cover loss damage or expense

            7.1 caused by strikers, locked-out workmen, or persons taking part in labour disturbances, riots or civil commotions

            7.2 resulting from strikes, lock-outs, labour disturbances, riots or civil commotions

            7.3 caused by any act of terrorism being an act of any person acting on behalf of, or in connection with, any organization which carries out activities directed towards the overthrowing or influencing, by force or violence, of any government whether or not legally constituted

            7.4 caused by any person acting from a political, ideological or religious motive.

 

 

INSTITUTE CARGO CLAUSES (B)

RISKS COVERED

Risks

1. 1. This insurance covers, except as excluded by the provisions of Clauses 4, 5, 6 and 7 below,

            1.1 loss of or damage to the subject-matter insured reasonably attributable to

            1.1.1 Fire or explosion

            1.1.2 Vessel or craft being stranded grounded sunk or capsized

            1.1.3 Overturning or derailment of land conveyance

            1.1.4 Collision or contact of vessel craft or conveyance with any external object other than water

            1.1.5 Discharge of cargo at a port of distress

            1.1.6 Earthquake volcanic eruption or lightning,

      1.2 loss of or damage to the subject-matter insured caused by

            1.2.1 General average sacrifice

            1.2.2 Jettison or washing overboard

            1.2.3 Entry of sea lake or river water into vessel craft hold conveyance container or place of storage,

            1.3 total loss of any package lost overboard or dropped whilst loading on to, or unloading from, vessel or craft.

 

General Average

 

2. 2. This insurance covers general average and salvage charges, adjusted or determined according to the contract of carriage and/or the governing law and practice, incurred to avoid or in connection with the avoidance of loss from any cause except those excluded in Clauses 4, 5, 6 and 7 below.

 

"Both to Blame Collision Clause"

 

3. 3. This insurance indemnifies the Assured, in respect of any risk insured herein, against liability incurred under any “Both to Blame Collision Clause” in the contract of carriage. In the event of any claim by carriers under the said Clause, the Assured agree to notify the Insurers who shall have the right, at their own cost and expense, to defend the Assured against such claim.

 

EXCLUSIONS

 

4. 4. In no case shall this insurance cover

            4.1 loss damage or expense attributable to wilful misconduct of the Assured

           4.2 ordinary leakage, ordinary loss in weight or volume, or ordinary wear and tear of the subject-matter insured

            4.3 loss damage or expense caused by insufficiency or unsuitability of packing or preparation of the subject-matter insured to withstand the ordinary incidents of the insured transit where such packing or preparation is carried out by the Assured or their employees or prior to the attachment of this insurance (for the purpose of these Clauses "packing" shall be deemed to include stowage in a container and "employees" shall not include independent contractors)

            4.4 loss damage or expense caused by inherent vice or nature of the subject-matter insured

            4.5 loss damage or expense caused by delay, even though the delay be caused by a risk insured against (except expenses payable under Clause 2 above)

            4.6 loss damage or expense caused by insolvency or financial default of the owners managers charterers or operators of the vessel where, at the time of loading of the subject-matter insured on board the vessel, the Assured are aware, or in the ordinary course of business should be aware, that such insolvency or financial default could prevent the normal prosecution of the voyage

This exclusion shall not apply where the contract of insurance has been assigned to the party claiming hereunder who has bought or agreed to buy the subject-matter insured in good faith under a binding contract

            4.7 deliberate damage to or deliberate destruction of the subject-matter insured or any part thereof by the wrongful act of any person or persons

            4.8 loss damage or expense directly or indirectly caused by or arising from the use of any weapon or device employing atomic or nuclear fission and/or fusion or other like reaction or radioactive force or matter.

5. 5. 5.1 in no case shall this insurance cover loss damage or expense arising from

            5.1.1 Unseaworthiness of vessel or craft or unfitness of vessel or craft for the safe carriage of the subject-matter insured, where the Assured are privy to such unseaworthiness or unfitness, at the time the subject-matter insured is loaded therein

            5.1.2 Unfitness of container or conveyance for the safe carriage of the subject-matter insured, where loading therein or thereon is carried out prior to attachment of this insurance or by the Assured or their employees and they are privy to such unfitness at the time of loading.

      5.2 Exclusion 5.1.1 above shall not apply where the contract of insurance has been assigned to the party claiming hereunder who has bought or agreed to buy the subject-matter insured in good faith under a binding contract.

      5.3 The Insurers waive any breach of the implied warranties of seaworthiness of the ship and fitness of the ship to carry the subject-matter insured to destination.

6. 6. In no case shall this insurance cover loss damage or expense caused by

      6.1 war civil war revolution rebellion insurrection, or civil strife arising therefrom, or any hostile act by or against a belligerent power

      6.2 capture seizure arrest restraint or detainment, and the consequences thereof or any attempt thereat

      6.3 derelict mines torpedoes bombs or other derelict weapons of war.

7. 7. In no case shall this insurance cover loss damage or expense

      7.1 caused by strikers, locked-out workmen, or persons taking part in labour disturbances, riots or civil commotions

      7.2 resulting from strikes, lock-outs, labour disturbances, riots or civil commotions

      7.3 caused by any act of terrorism being an act of any person acting on behalf of, or in connection with, any organization which carries out activities directed towards the overthrowing or influencing, by force or violence, of any government whether or not legally constituted

      7.4 caused by any person acting from a political, ideological or religious motive.

 

INSTITUTE CARGO CLAUSES (C)

RISKS COVERED

Risks

1. 1. This insurance covers, except as excluded by the provisions of Clauses 4, 5, 6 and 7 below,

            1.1 loss of or damage to the subject-matter insured reasonably attributable to

            1.1.1 Fire or explosion

            1.1.2 Vessel or craft being stranded grounded sunk or capsized

            1.1.3 Overturning or derailment of land conveyance

            1.1.4 Collision or contact of vessel craft or conveyance with any external object other than water

            1.1.5 Discharge of cargo at a port of distress,

      1.2 loss of or damage to the subject-matter insured caused by

            1.2.1 General average sacrifice

            1.2.2 Jettison.

 

General Average

 

2. 2. This insurance covers general average and salvage charges, adjusted or determined according to the contract of carriage and/or the governing law and practice, incurred to avoid or in connection with the avoidance of loss from any cause except those excluded in Clauses 4, 5, 6 and 7 below.

 

"Both to Blame Collision Clause"

 

3. 3. This insurance indemnifies the Assured, in respect of any risk insured herein, against liability incurred under any “Both to Blame Collision Clause” in the contract of carriage. In the event of any claim by carriers under the said Clause, the Assured agree to notify the Insurers who shall have the right, at their own cost and expense, to defend the Assured against such claim.

 

EXCLUSIONS

 

4. 4. In no case shall this insurance cover

            4.1 loss damage or expense attributable to willful misconduct of the Assured

            4.2 ordinary leakage, ordinary loss in weight or volume, or ordinary wear and tear of the subject-matter insured

            4.3 loss damage or expense caused by insufficiency or unsuitability of packing or preparation of the subject-matter insured to withstand the ordinary incidents of the insured transit where such packing or preparation is carried out by the Assured or their employees or prior to the attachment of this insurance (for the purpose of these Clauses "packing" shall be deemed to include stowage in a container and "employees" shall not include independent contractors)

            4.4 loss damage or expense caused by inherent vice or nature of the subject-matter insured

            4.5 loss damage or expense caused by delay, even though the delay be caused by a risk insured against (except expenses payable under Clause 2 above)

            4.6 loss damage or expense caused by insolvency or financial default of the owners managers charterers or operators of the vessel where, at the time of loading of the subject-matter insured on board the vessel, the Assured are aware, or in the ordinary course of business should be aware, that such insolvency or financial default could prevent the normal prosecution of the voyage

This exclusion shall not apply where the contract of insurance has been assigned to the party claiming hereunder who has bought or agreed to buy the subject-matter insured in good faith under a binding contract

            4.7 deliberate damage to or deliberate destruction of the subject-matter insured or any part thereof by the wrongful act of any person or persons

            4.8 loss damage or expense directly or indirectly caused by or arising from the use of any weapon or device employing atomic or nuclear fission and/or fusion or other like reaction or radioactive force or matter.

5. 5. 5.1 In no case shall this insurance cover loss damage or expense arising from

            5.1.1 Unseaworthiness of vessel or craft or unfitness of vessel or craft for the safe carriage of the subject-matter insured, where the Assured are privy to such unseaworthiness or unfitness, at the time the subject-matter insured is loaded therein

            5.1.2 Unfitness of container or conveyance for the safe carriage of the subject-matter insured, where loading therein or thereon is carried outprior to attachment of this insurance or by the Assured or their employees and they are privy to such unfitness at the time of loading.

            5.2 Exclusion 5.1.1 above shall not apply where the contract of insurance has been assigned to the party claiming hereunder who has bought or agreed to buy the subject-matter insured in good faith under a binding contract.

            5.3 The Insurers waive any breach of the implied warranties of seaworthiness of the ship and fitness of the ship to carry the subject-matter insured to destination.

6. 6. In no case shall this insurance cover loss damage or expense caused by

            6.1 war civil war revolution rebellion insurrection, or civil strife arising therefrom, or any hostile act by or against a belligerent power

            6.2 capture seizure arrest restraint or detainment, and the consequences thereof or any attempt thereat

            6.3 derelict mines torpedoes bombs or other derelict weapons of war.

7. 7. In no case shall this insurance cover loss damage or expense

            7.1 caused by strikers, locked-out workmen, or persons taking part in labour disturbances, riots or civil commotions

            7.2 resulting from strikes, lock-outs, labour disturbances, riots or civil commotions

            7.3 caused by any act of terrorism being an act of any person acting on behalf of, or in connection with, any organization which carries out activities directed towards the overthrowing or influencing, by force or violence, of any government whether or not legally constituted

            7.4 caused by any person acting from a political, ideological or religious motive.

 

 

Here is a table you can compare these clauses.

 

Summary of Institute Cargo Clauses Coverage
Loss or Damage Caused by:	Clause A	Clause B	Clause C
General Average	✓	✓	✓
Both to Blame Collision	✓	✓	✓
Fire or explosion	✓	✓	✓
Vessel or Craft being stranded	✓	✓	✓
Overturning or derailment of land conveyance	✓	✓	✓
Collision or contact of vessel, craft or conveyance with any object other that water	✓	✓	✓
Discharge of cargo at a port of distress	✓	✓	✓
General average sacrifice	✓	✓	✓
Jettison	✓	✓	✓
Earthquake, volcanic eruption or lightning	✓	✓
Washing overboard	✓	✓
Entry of sea, lake or river water into vessel, craft, hold, conveyance, container, liftvan or place of storage	✓	✓
Total Loss of any package lost overboard or dropped whilst loading on to, or unloading from, vessel of craft	✓	✓
Theft or pilferage	✓
Contamination (own damage)	✓
Rain &/or fresh water damage	✓