4614257
Description
Flashcards by Pamela Stanton, updated more than 1 year ago
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Created by Pamela Stanton
over 8 years ago
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| Question | Answer |
| 5 Methods of Transportation Covered Under Marine Cargo Insurance Policy: | 1. Transport over the ocean 2. Transport over land 3. Transport via air 4. Transport via rail 5. Vessels operating on inland waterways and lakes |
| 4 Parties Having an Insurable Interest in Cargo Being Shipped: | 1. Sellers 2. Buyers 3. Carriers 4. Financial Institutions |
| 2 Documents to Determine Insurable Interest of Parties: | 1. Terms of sale/ contract 2. Bills of lading |
| Two Items of Focus for Identifying under the Terms of Sale: | 1. The INCOTERM under which goods are being shipped 2. Method of payment for the goods |
| Three Questions Addressing the Issue of Insurable Interest under the INCOTERMS: | 1. The point in transit at which the seller has fulfilled its obligation? 2. Which of the buyer or seller is responsible for carriage from one point to another? 3. Which of the buyer or seller is responsible for insurance? |
| INCOTERMS: | 1. Ex Works 2. F.O.B 3. F.A.S (FOQ) 4. FOR (FOT) 5. C and F (CFR) 6. C.I.F |
| 1. Ex Works: | Buyer: Pays for the invoice cost of goods and must arrange insurance from the works to final destination. |
| 2. F.O.B (Free on Board) | Buyer: Takes responsibility for goods once they are on board the vessel. Insurance is the responsibility of the buyer from this moment until final delivery. Seller: Responsible for carriage/ loading costs and any damage until goods are loaded on board. Insurance is the responsibility of the seller from works until on board. |
| 3. F.A.S (Free Alongside) | Buyer: Takes responsibility for goods as soon as they are alongside the vessel or on the quay. Insurance is the responsibility of the buyer from this moment until final delivery. Seller: Responsible for carriage and unloading costs until goods are alongside the vessel or on the quay. Insurance is the responsibility of the seller from works up to this point. |
| 4. F.O.R (Free on Rail(FOT- Free On Trailer)) | Buyer: Responsible for goods once they have been loaded on rail or trailer. Insurance is the responsibility of the buyer from this moment until final delivery to destination. Seller: Responsible for goods until they are loaded on rail or trailer. |
| 5. C and F ((CFR)Cost of Goods and Freight Charges Paid Until Port of Discharge) | Buyer: Takes responsibility for goods once they are loaded onto the carrying vessel. Insurance is the responsibility of the buyer from this moment until final delivery. Seller: Responsible for goods until loaded onto the carrying vessel. Insurance is the responsibility of the seller from works until this time |
| 6. C.I.F (Cost, Insurance, and Freight) | Buyer: Not responsible for insurance as this is included in the contract price. However, increased value cover at the ultimate destination may be required to meet charges or increased market value. Seller: Responsible for providing insurance, but usually follows the buyers instructions. |
| Methods of Payment for Goods: | 1. Cash in Advance 2. Open Account 3. Draft 4. Letter of Credit |
| 1. Cash in Advance: | Used when the buyer is not well known to the seller and the order involves custom manufacture of special types of goods without a ready market. |
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