Difference Between Marine and Cargo Insurance (With Table)

Marine Insurance, as the word suggests, is protection against damages caused during transit via the sea. It has various subtypes and provides for any losses incurred during the time the journey till the goods reach their destination.

Marine vs Cargo Insurance

The main difference between Marine Insurance and Cargo Insurance is that marine insurance covers a lot of benefits, and the insured party gets an option to choose from the subtypes. In contrast, cargo insurance just covers the losses that are caused due to timing delay of the ship or an accident as it is only a subtype of marine insurance.

Cargo insurance, on the other hand, is also a subtype of Marine insurance. It also covers damages caused to goods in transportation via land and air. It protects freight in case any damages are caused to the products in transit.

Marine and cargo insurance are both essential for the protection of goods during international trade, but marine coverages encompass a lot of other aspects as well.


Comparison Table Between Marine and Cargo Insurance (in Tabular Form)

Parameter of Comparison

Marine Insurance

Cargo Insurance


Marine Insurance has a lesser scope.

Cargo insurance has a broader scope.


Its subtypes include Hull insurance, Cargo Insurance, Freight Insurance and Marine Liability Insurance

Its subtypes include land cargo and marine cargo insurance. These are further divided into categories based on duration.

Risk covered

It protects against damages caused due to perils of the sea-based on the plans chosen.

It covers the risk of damage caused due to lightning, fire, explosion, storm, earthquakes, etc.

Type of Transportation

Marine Insurance only includes sea transits.

It provides for losses against damages caused during transit via land, sea or air.


The first marine insurance company was Lloyd’s Coffee House.

It’s the first type, marine cargo insurance, was introduced by Edward Lloyd.


It is highly customizable.

It does not provide as many customization options as marine insurance.


What is Marine Insurance?

Edward Lloyd introduced marine insurance in the 1680s. It was because the oversea trade from London has made marine insurance a necessity. Lloyd owned a coffee shop which the merchants and ship owners frequented. Thus, he started the first marine insurance company by the name Lloyd’s Coffee House.

It is a highly customizable form of insurance to protect insured against losses incurred due to damages caused during the oversea transit. There are different types of Marine Insurance, namely Hull insurance, Cargo Insurance, Freight Insurance and Marine Liability Insurance.

Hull insurance provides for losses caused because of waterborne damages. Freight insurance protects the insured against freight losses caused in the event of cargo loss or accident. Marine Liability insurance is to provide for damages caused due to collision or crashes.


What is Cargo Insurance?

Cargo refers to the goods that are being transported. During transportations, the products can get damaged due to several reasons, and this is where cargo insurance comes into play. Any damage caused to the goods is covered by cargo insurance. This includes accidents caused during transit via air, sea or land. This provides security to the insured until the time goods reach the destination.

Land cargo provides for losses caused due to reasons like collision, theft, etc. it is usually within the boundaries of the country. Marine Insurance covers losses due to reasons like damages while loading/unloading, weather conditions, etc. There are other types of cargo insurance as well, such as open cover cargo, specific cargo, contingency cargo insurance, etc. Based on risk, cargo insurance can be categorized into all risk, free of particular average and shipment by shipment insurance.

In all risk coverage type of cargo insurance, the insured is even protected against damages caused due to improper packaging, abandonment, infestation, rejection, invasion, fire, riots, etc. The free of particular average insurance type covers losses caused due to collision, weather conditions, sinking, theft, earthquake etc. The shipment by shipment insurance type provides for losses caused due to damages to the shipping vessel. Acts of war and God are excluded from the coverage.

Main Differences Between Marine and Cargo Insurance

  1. Marine Insurance is only for goods that are being transported via sea through ships and other vessels. Cargo insurance provides for damages to products in transit via land, sea or air.
  2. Marine Insurance is further divided into four categories, namely Hull insurance, Cargo Insurance, Freight Insurance and Marine Liability Insurance. Cargo insurance is divided into two groups, namely land cargo and marine cargo.
  3. Marine Insurance was introduced by Edward Lloyd whereas Cargo insurance came into existence with its subtype, i.e., marine cargo, which was also a part of marine insurance.
  4. Marine Insurance is highly customizable, whereas Cargo insurance is not as customizable as compared to the former.
  5. Marine Insurance has a limited scope as it is just restricted to travel via sea whereas cargo insurance covers land, sea and air, thus, having a broader reach.



With an increasing need for movement of goods, protection of those goods become a necessity. Thus, marine insurance and cargo insurance both have an essential role to play in transit of goods.

While marine insurance protects the insured only in transportation of goods via sea, cargo insurance covers land and air as well. This widens the scope of cargo insurance, but it is still a subtype when it comes to marine insurance. Thus, marine insurance has a limited scope in comparison to cargo insurance in areas of risk coverage and mode of transportation.

Marine Insurance helps to provide for losses caused due to damages to goods because of the perils of the sea such as collision, storm, etc. Cargo insurance covers all damages related to products such as infestation, employee’s negligence/dishonesty, earthquake etc.

Marine Insurance and cargo insurance are very distinct, and it is up to the insured to choose which insurance he/she requires according to the demands of his/her orders.


  1. https://heinonline.org/hol-cgi-bin/get_pdf.cgi?handle=hein.journals/tulr66&section=19
  2. https://nsuworks.nova.edu/cgi/viewcontent.cgi?referer=https://scholar.google.com/&httpsredir=1&article=1118&context=ilsajournal/