Single Voyage vs Annual Marine Insurance – Which Policy Is Right for You?
- digital @btwimf.com
- Jul 18
- 2 min read
Table of Contents
Marine insurance protects goods in transit from risks such as theft, fire, piracy, and natural calamities. Exporters and importers must decide between single voyage and annual policies depending on their shipment frequency and business model.
What Is Single Voyage Marine Insurance?
Covers a single trip of cargo, from one point of origin to destination.
Premium is calculated based on cargo value, risk level, and route.
Ideal for companies with occasional or one-time shipments.
Example: A small exporter shipping machinery once to Europe can use a single voyage policy instead of paying for year-round coverage.
What Is Annual Marine Insurance?
Covers multiple shipments made by a company within a year.
Offers broader flexibility across routes, cargo types, and modes of transport.
Premium is fixed annually, regardless of number of shipments.
Example: A logistics company or frequent exporter shipping garments every month benefits more from an annual policy.
Key Differences Between the Two
Factor | Single Voyage Insurance | Annual Marine Insurance |
Coverage Period | One shipment only | All shipments in one year |
Costing | Pay-per-shipment | Fixed annual premium |
Best For | Occasional exporters/importers | Frequent shippers, logistics firms |
Flexibility | Limited | Broad, covers multiple routes |
Documentation | Issued per shipment | One-time issuance |
When Should You Choose Single Voyage Insurance?
For one-off export/import orders
When cargo value is high but shipments are infrequent
For trial shipments or new trade partners
When Should You Choose Annual Marine Insurance?
For businesses with regular shipments (weekly/monthly)
When covering multiple buyers and destinations
To simplify administration with fewer documents and faster clearance
Cost Comparison and Business Impact
Single Voyage: Lower upfront cost but expensive in the long run if shipping frequently.
Annual Policy: Higher upfront cost but economical for regular traders.
Exporters must calculate shipment frequency and compare total premiums before deciding.
Compliance and Documentation Considerations
Many letters of credit (LCs) require proof of insurance before banks release payment.
Annual policies save time in such cases by offering ready documentation for every shipment.
Single voyage requires fresh paperwork per shipment, which may delay customs clearance.
FAQ's
1. Is annual marine insurance more expensive?
Not necessarily—it’s more cost-effective for frequent shipments compared to repeated single voyage premiums.
2. Can small exporters take annual policies?
Yes, but it’s advisable only if shipments are frequent.
3. Can I convert a single voyage policy into annual insurance?
No, but insurers may allow upgrades if you request before expiry.
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