Cargo transit insurance (nakliyat emtia sigortası) protects the goods themselves against loss, damage and theft during the journey. It pays out on the sum insured in the policy regardless of whether the carrier was at fault. The Incoterms rule in the sales contract determines who takes it out; the scope is usually chosen from the Institute Cargo Clauses ICC (A), (B) or (C) of the London institute.
What does it cover and what not?
Cargo insurance protects the cargo owner's interest: it secures that goods leaving the factory reach the buyer's warehouse in sound condition. It is used in road, sea, air and rail transport and in multimodal transport combining them. Policies in Türkiye are based on the General Conditions of Cargo Transit Insurance (Emtea Nakliyat Sigortası Genel Şartları); in international business, the Institute Cargo Clauses (ICC) are added. Under the transit clause of the ICC, cover runs "warehouse to warehouse": it begins when the goods are first moved for loading and ends on delivery at the final warehouse. In sea transport it also ends once 60 days have passed after discharge.
The main exclusions are: insufficient packing, deterioration arising from the inherent nature of the goods, ordinary leakage and loss in weight, delay, and wilful misconduct of the insured. War and strike risks are added by separate clauses. The detailed list is in the cargo insurance exclusions entry.
Why is it needed when there is CMR insurance?
The carrier's CMR insurance does not protect the goods but the carrier's legal liability. This liability is limited to 8.33 SDR per kilogram gross and does not arise at all in cases such as force majeure or packing defects. Even if 2 tonnes of electronic boards are worth USD 400,000, the amount recoverable under the CMR will not exceed USD 25,000. A cargo policy, on the other hand, pays the sum insured without looking for fault and then seeks recourse from the carrier. The two types of insurance are compared in the CMR vs cargo insurance entry.
Who takes it out?
The insurance is taken out by the party bearing the risk during the journey. This is determined by Incoterms 2020:
| Incoterms rule | Who takes out the insurance? | Minimum requirement |
|---|---|---|
| EXW, FCA, FAS, FOB, CFR, CPT | Risk during main carriage lies with the buyer; the buyer insures in its own interest | No obligation |
| CIF | The seller, in favour of the buyer | At least ICC (C), 110% of the contract value |
| CIP | The seller, in favour of the buyer | At least ICC (A), 110% of the contract value |
| DAP, DPU, DDP | Risk lies with the seller until delivery; the seller insures in its own interest | No obligation |
For details by rule, see the who insures under Incoterms entry.
What types of cover are there?
- ICC (A), "all risks": Any sudden and unforeseen loss and damage other than the expressly excluded ones. Theft, breakage and wetting fall within this cover; its application is discussed separately on the All Risks cargo transit cover page.
- ICC (B): In addition to the (C) risks: earthquake, lightning, washing overboard, entry of sea or river water into the hold or container, and total loss of a package dropped during loading or unloading.
- ICC (C): Major events such as fire, explosion, stranding or sinking of the vessel, overturning of a land conveyance, collision, general average sacrifice and jettison.
- ICC (Air): "All risks"-type cover for air cargo.
The fragility of the cargo and the theft risk are decisive in the choice: ICC (A) is preferred for electronics or machine parts, and often ICC (C) for bulk raw materials.
What should be watched for each transport mode?
On the road, the most frequent causes of damage are overturning, poor stowage and theft in parking areas; ICC (C) covers only the first of these. In sea transport, general average contributions and hold sweat stand out. In Ro-Ro, since the truck travels on the ship, both land and sea risks should be considered in the same policy. For heavy and oversize cargo, losses such as installation delays require separate project cargo cover. For multimodal shipments, international transport insurance can be structured to cover all stages in a single policy.
How is the sum insured determined?
Common practice is to add 10 percent expected profit to the CIF value (goods + freight + insurance). If the sum is set too low, the under-insurance rule applies and the indemnity is reduced in the same proportion. The calculation method is illustrated in the sum insured entry.