Vehicle Shipping Insurance Explained: What's Covered and What's Not

Shipping a vehicle overseas involves inherent risks — from minor scratches during loading to more serious incidents during ocean transit. While damage is rare (occurring on fewer than 2% of shipments), having proper insurance coverage provides essential peace of mind.

All reputable vehicle shipping companies include basic marine transit insurance as part of their service. However, understanding exactly what this covers — and what it doesn't — is crucial for making informed decisions about your shipment. Whether you're shipping via RORO or container, understanding your coverage is essential.

There are three main levels of coverage available for vehicle shipping:

1. Institute Cargo Clauses (C) — Basic Cover The minimum standard. Covers:
• Total loss of the vessel (sinking, fire, explosion)
• Jettison (cargo thrown overboard in emergency)
• General average contribution

Does NOT cover: individual vehicle damage, theft, scratches, dents.

2. Institute Cargo Clauses (A) — All Risks Cover Comprehensive coverage. Covers:
• All risks of physical loss or damage during transit
• Includes loading and unloading
• Theft, scratches, dents, water damage
• Fire, collision, overturning

3. Agreed Value Policy Similar to Clauses (A) but with a pre-agreed vehicle value. In the event of a total loss, the full agreed amount is paid without depreciation debate.

The Ship Cars includes Institute Cargo Clauses (A) — all risks cover — as standard on every shipment.

Even comprehensive all-risks policies have standard exclusions:

- Pre-existing damage: Any damage present before shipping is not covered. This is why condition reports and photographs are essential.
• Mechanical or electrical failure: Insurance covers physical damage, not mechanical breakdown.
• Inherent vice: Damage caused by the nature of the goods themselves (e.g., rust progression, battery acid leakage).
• Delay: Financial losses due to delayed delivery are not covered under cargo insurance.
• Improper packing: If the vehicle was not properly secured (though The Ship Cars manages all securing professionally).
• War and strikes: Standard policies exclude war zones, though coverage can be added for an additional premium.
• Ordinary wear and tear: Normal transit marks such as light dust accumulation or minor stone chips.

Understanding these exclusions helps you prepare properly and set realistic expectations.

If your vehicle arrives damaged, follow these steps:

1. Document immediately: Photograph all damage at the destination port before moving the vehicle. Note the damage on the delivery receipt or condition report.
2. Notify The Ship Cars: Contact us within 3 days of delivery with photographs and a description of the damage.
3. Do not repair: Do not authorise repairs until the claim has been assessed. Get repair estimates from two authorised workshops.
4. Complete claim form: We provide the claim form and guide you through the process.
5. Submit evidence: Photographs, condition reports (before and after), repair estimates, and the Bill of Lading.
6. Assessment: The insurer assesses the claim, which typically takes 10–30 business days.
7. Settlement: Approved claims are paid directly to you.

The Ship Cars manages the claims process on your behalf, liaising with insurers and providing all necessary shipping documentation.

For most standard vehicles, the all-risks coverage included with The Ship Cars is sufficient. However, consider enhanced coverage if:

- Vehicle value exceeds £25,000: Higher-value vehicles may benefit from an agreed-value policy to avoid any undervaluation disputes.
• Classic or irreplaceable vehicle: Agreed-value coverage ensures the full collector value is protected, not just market value.
• Shipping to high-risk destinations: Some routes may benefit from additional war and strikes coverage.
• Sentimental value: While insurance compensates financial loss, ensuring maximum coverage reduces stress.

The Ship Cars can arrange enhanced agreed-value policies for any shipment. The additional premium is typically 0.5–1.5% of the declared vehicle value — a small price for comprehensive peace of mind. Factor the premium into the totals on our car shipping costs page.