Inland Marine Policy

What Does Inland Marine Policy Mean?

Despite the term “marine” in the name, an inland marine policy does not necessarily relate to the sea. Instead, it is an insurance policy designed to cover movable or specialized types of property. Commonly covered property includes:

• Goods in transit
• Property in the custody of a bailee
• Equipment or structures integral to a transportation or communication system, such as bridges or microwave towers
• Mobile medical equipment
• Equipment owned by a construction contractor
• Goods that frequently move between different locations

Inland marine policies are sometimes referred to as “floaters,” a term derived from the concept of goods being transported by sea, even though, in reality, the property is rarely at sea.

Insuranceopedia Explains Inland Marine Policy

Many people may wonder why the term “marine” is used in inland marine policies when the insured property is rarely at sea. The term originates from one of the earliest forms of insurance, which covered goods transported internationally by sea, typically on an all-risk basis. Fire insurance, which developed next, was usually narrower in scope, covering only specified perils and often focused on buildings.

As the need for broader coverage emerged, including for property now covered by inland marine policies, fire insurers were hesitant to provide the necessary coverage. Marine insurers, who were already established in the industry, stepped in to fill the gap. Since these insurers were already known as “marine” insurers, the new types of coverage became known as “inland marine” policies. Today, commercial marine insurance still covers cargo at sea, while inland marine policies handle the same goods once they are unloaded and moved overland.

In addition to the property types already mentioned, inland marine policies often cover:

• Computers
• Photographic and video equipment
• Art exhibitions
• Golf equipment
• Guns
• Jewelry
• Equipment used by caterers
• Drugs carried by pharmaceutical representatives
• Landscapers’ tools
• Tradespeople’s tools
• Equipment or tools at building sites
• Goods in warehouses or repair shops

Independent tradespeople and contractors often rely on this kind of policy for tool and equipment insurance, which pays to replace gear stolen or damaged at a job site or in transit. Many owners buy it as part of a wider business insurance policy that also covers general liability and property.