A 12 Billion Rupiah Container Goes Missing at Sea! Who’s Responsible?

Imagine a container containing export goods worth Rp 12 billion lost at sea. The shipment, which was supposed to arrive at its destination port, suddenly never arrived. The loss is astronomical, and a major question arises: Who should bear responsibility for this loss?

Cases like this are not uncommon in the world of logistics and import and export. Many business owners only realize the importance of marine cargo insurance after experiencing such an incident. However, the risk of loss or damage to goods during shipping can occur at any time due to storms, shipwrecks, piracy, or loading errors.

And because every large-value shipment has the potential for unexpected losses, before the risk occurs, Contact L&G Insurance Broker now at 08118507773 for free consultation before risk. With extensive experience in marine cargo insurance and logistics, the L&G team is ready to help ensure your export business remains secure, no matter how big the risk.

Getting to the Root of the Problem: Who’s Responsible When a Container Goes Missing?

In export-import transactions, responsibility for goods does not always rest with one party. This is governed by Incoterms (International Commercial Terms), a global set of rules that determine when risk transfers from the seller (exporter) to the buyer (importer). Understanding Incoterms is key to logistics risk management.

Incoterms: Limitation of Liability

• Under the FOB (Free on Board) scheme, risk and responsibility transfer to the buyer once the goods have been loaded onto the ship (passed the ship’s rail). If a container worth IDR 12 billion is lost after being loaded, the buyer must claim cargo insurance.
• Under the CIF (Cost, Insurance, and Freight) scheme, the seller (exporter) remains responsible for the goods until they arrive at the destination port, including insurance and shipping costs. The seller is required to provide marine cargo insurance of at least ICC C.

Problems often arise when exporters and importers are not clearly aware of the limits of their liability. In many cases of cargo loss, insurance companies reject claims because it turns out that risk responsibility had already shifted before the incident occurred. This is where the role of an insurance broker becomes crucial, not only as a policy provider but also as a consultant, ensuring that each of your export contracts aligns with the appropriate insurance provisions.

So, before the risk comes, discuss your shipping contract withL&G Insurance Broker of08118507773.With the right guidance, you can avoid the fatal mistakes that make it difficult to get your freight insurance claim accepted.

Risk of Container Loss in International Waters

Every year, thousands of containers fall or are lost on the high seas. According to a report by the World Shipping Council, an average of over 1,500 containers are lost annually due to storms, high waves, or ship failures. The losses reach trillions of rupiah globally.

The Main Cause of the Loss of the Rp12 Billion Container

• Extreme Weather (Sea Storms): High waves and storms can cause stacks of containers on the deck of a ship to become dislodged and fall into the sea.
• Cargo Imbalance: Unstable container stacking error, causing containers to come loose from the stack when the ship rolls.
• Shipwreck: Collision, fire on board, or shipwreck.
• Sea Piracy: Especially in high-risk areas; high-value containers are targets for theft.
• General Average: A risk where all cargo owners must share the financial loss when the vessel faces a major risk.

If you’re shipping high-value goods like industrial machinery, electronics, or manufactured products worth billions of rupiah, the loss of just one container can devastate your company’s cash flow. The good news is, marine cargo insurance can protect you from the risk of total loss or partial loss. With the right policy coverage, you can claim the full value of your cargo as agreed.

And to ensure that the policy you have is truly appropriate for the risks of your trip, consult withL&G Insurance Broker now in08118507773for free consultation before risk.

Types of Marine Cargo Insurance Coverage for High Value Goods

Not all marine cargo insurance policies offer the same coverage. For goods worth billions, choosing the wrong policy can be a costly mistake and lead to significant losses for exporters. Selecting the right marine cargo insurance coverage is fundamental to risk management.

Institute Cargo Clauses (ICC)

In general, there are three main levels of protection known as Institute Cargo Clauses (ICC), published by the International Underwriting Association of London:

• ICC (A) – All Risks: The most comprehensive protection, covering almost all risks of loss or damage except those excluded (such as deliberate acts or inherent defects). Mandatory for shipping high-value items such as electronics or machinery.
• ICC (B): Moderate coverage, protects against certain perils such as fire, collision, or sinking of the vessel. Does not cover handling or sweat damage.
• ICC (C): Basic protection, only covers major disaster risks (Major Casualties) such as fire or ship running aground.

For shipments valued at IDR 12 billion or more, ICC (A) is recommended to ensure full coverage of all potential risks. Additionally, you can add additional clauses tailored by your logistics insurance broker:

• War and Strike Clause (WSRCC): Protects against the risk of war, sabotage, or riot.
• Warehouse to Warehouse Clause: Guarantees protection from the time the goods leave the sender’s warehouse until they arrive at the recipient’s warehouse.

Unfortunately, many exporters simply choose policies with low premiums without considering the true risks. As a result, when loss or damage occurs, claims may not be fully paid. To avoid this, ensure you are assisted by a cargo insurance broker who understands the characteristics of international shipping and the value of your goods.

Contact L&G Insurance Broker at08118507773so that our team of experts can help you choose the most appropriate marine cargo insurance policy to suit your export needs.

Common Exporter Mistakes When Claiming Loss

When containers are lost at sea, the claims process can be complicated if documents are incomplete or shipping contracts are unclear. Administrative and logistical errors can cause companies to lose compensation for cargo worth billions.

• Failure to Attach Original Documents: Failure to include original shipping documents such as the Bill of Lading, invoice, and packing list. Without these documents, your cargo insurance claim will be rejected.
• Delay in Claim Reporting: Marine insurance claims must be reported within a very short time (e.g., 7 to 14 days) of the incident. Delays in reporting will result in a claim being time-barred.
• Underinsurance: As explained earlier, insuring goods below their actual value results in incomplete compensation.
• Lack of Evidence of Ship’s Cargo: No evidence of loss or official report from the vessel at the time of the incident.
• Misinterpretation of Incoterms: Filing a claim even though the risk has already transferred responsibility to the buyer.

Small administrative errors like this can cost a company its entire claim rights. L&G Insurance Broker understands this challenge fully. As an experienced logistics insurance broker in South Tangerang, we not only help you select a policy but also guide you through the claims process from start to finish. Don’t let administrative errors wipe out your potential compensation.

The Important Role of Logistics Insurance Brokers in Securing IDR 12 Billion

A logistics insurance broker’s role is more than just an intermediary between you and the insurance company. They are strategic partners who help ensure your business remains protected from risks that could disrupt operations. L&G Insurance Brokers understands the ins and outs of shipping and cargo insurance in Indonesia.

• Comprehensive Risk Analysis: Analyze risks based on the type of goods (fragile, hazardous, or heavy equipment) and shipping route.
• Premium and Clause Negotiation: Negotiate the best premiums with leading insurance companies in Indonesia and abroad, and ensure the addition of important clauses (ICC A, WSRCC, Delay Extension).
• Drafting Contract Documents: Ensuring that the cargo insurance policy and shipping contract (Incoterms) are aligned.
• Total Claims Assistance: L&G Brokers provide full assistance throughout the claims process, including preparing evidence and negotiating payment. They strive to ensure your Rp 12 billion loss is fully reimbursed.
• Exporter Education: Providing personalized consulting services, so that each of your shipments has optimal protection and complies with regulations.

With the support of a professional team that understands the logistics, construction, and import-export industries, L&G has helped many companies save billions of rupiah from the risk of lost or damaged goods. So, before you ship high-value containers overseas, make sure you have the right protection..

L&G Case Study: Rescuing a Container from General Average

One of the biggest unavoidable risks in maritime logistics is General Average. This occurs when a ship’s captain must sacrifice some of the cargo to save the ship and the remaining cargo from a major risk (such as fire). All cargo owners on board (including those whose goods survived) are required to contribute to cover the ship’s losses.

In the case of an L&G client shipping cargo worth IDR 8 billion, the vessel experienced a General Average Incident. Because L&G had provided appropriate marine cargo insurance, the insurer immediately issued a General Average Bond or Guarantee for the client. This allowed the client’s container to be quickly discharged at the port and avoid detention, without the client having to pay a significant amount of cash as an initial contribution. The role of an insurance broker is crucial in these emergency shipping situations.

Conclusion

Losing a container worth Rp 12 billion at sea is not just a material loss; it can also disrupt the reputation and operations of your export business. Therefore, understanding legal responsibilities, Incoterms, cargo insurance policy types (ICC A), and the claims process is essential for every professional exporter and importer. Don’t let a mistake in choosing a shipping policy or contract derail your business due to risks that could have been transferred.

Amid the complexity of global logistics and the high risk of cargo loss, a logistics insurance broker is an irreplaceable strategic partner. L&G Insurance Broker ensures every risk is controlled from warehouse to port, all the way to the buyer’s hands with a robust and legal marine cargo insurance policy. L&G helps you establish comprehensive asset protection, efficiently saves on premiums, and ensures smooth claims processing.

Since the risk of loss can occur at any time, and your billion-dollar container is your biggest investment, acting proactively today is key to business sustainability.

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DON’T WASTE YOUR TIME AND SECURE YOUR FINANCIAL AND BUSINESS WITH THE RIGHT INSURANCE.

HOTLINE L&G 24 JAM: 0811-8507-773(CALL – WHATSAPP – SMS)

Website: lngrisk.co.id

Email: halo@lngrisk.co.id

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