This cover has traditionally been provided for manufacturing machinery that is being transported to be installed in a new factory.

An example might be a specialist plastics extrusion machine that is imported from Europe to New Zealand to make a specific range of products. Projected sales revenues and profits have been calculated in advance during the project feasibility study. Considerable time, effort and expense have been spent in preparing the factory site and in purchasing the machine.

The standard form of Marine Cargo Policy only provides for payment of claims in excess of the actual material value of the loss by including a small margin of profit over and above the C.I.F. value of the goods, normally limited to a maximum of 10%. This, however, gives very little additional cover to compensate for any loss of anticipated profits, increased costs of working and other financial losses which can occur when capital goods (such as machinery) are lost or damaged in transit as a result of marine risks.

Vero Marine can offer an extension of cover to the physical damage cover under the standard marine policy by means of Consequential Loss Insurance, sometimes called Advance Loss of Profits (ALOP) or Delayed Start-Up (DSU). Within Vero Marine and the Suncorp Group, we have extensive experience in writing this class of business. A considerable amount of information is required for us to assess the risk so we can only offer this extension if we are consulted some time before the physical project transit commences.

Vero Marine must be the cargo insurers, as this ensures that as consequential loss underwriters, we will be in a position to influence the arrangements for repair or replacement of lost or damaged items. This is vital if we are to mitigate the effects of a possible loss under this Consequential Loss section of the policy.

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