Does “All Risks” pay for everything?

No. All Risks extends FPA to cover loss from general external causes and is the broadest of the basic covers, but it is still bounded by the clauses and the exclusions. Typical directions include inadequate packing, inherent vice of the cargo, natural shrinkage and market loss from delay — precisely why many claims are refused.

How do I choose between FPA, WPA and All Risks?

Start from what this cargo most fears. FPA is comparatively narrow and centres on major casualties connected with the vessel; WPA extends it to particular average arising from certain natural calamities; All Risks is the widest. The basis is the cargo’s characteristics and the route’s risk — not “the most expensive must be the best”.

How is the insured amount set?

Usually the invoice value or the CIF value plus an uplift, with the percentage set by the contract and the letter of credit. The uplift covers expected profit and part of the indirect cost, because a loss costs more than the goods alone. That percentage must be verified shipment by shipment and cannot be carried over from the previous one.

What does the deductible mean?

It is a “you carry the first part” mechanism. An absolute deductible is deducted from every loss; a relative (franchise) deductible stops applying once the loss passes a threshold. Settlement depends directly on how it is expressed, so check whether it is an amount or a percentage, and whether it applies per accident or per shipment.

In which cases is insurance compulsory?

Two are clear: where the trade term puts transit risk on you, and where the contract or the L/C requires an insurance document to be presented. Beyond that, high-value, fragile or multi-transhipment cargo carries a large exposure and is normally worth insuring. Whether to insure should ultimately be confirmed with the customer with the cost transparent.

What should I do first after a loss?

Do not change the cargo’s condition. Take images and a written record in the state it was found, then notify the relevant parties within the time limit and in the manner the policy requires, and arrange a qualified body to survey or issue a report. Prepare the B/L, invoice and packing list to prove the identity of this shipment with the insured cargo.

Are insurance and carrier liability the same thing?

No. The carrier’s liability is bounded by the contract of carriage and by statutory limits, and it is routinely excluded for causes outside the carrier’s responsibility. Cargo insurance covers the cargo’s transit exposure on the terms of the policy. The two do not replace each other — where you rely on one and the loss falls outside it, the other may be the only route left.

Do the insurance details have to match the other documents?

Yes. The description, quantity, value and voyage on the insurance document have to line up with the invoice, packing list and B/L. A mismatch is challenged at claim stage as a question of identity, and it can be just as damaging as a mismatch at customs.

Marine Cargo Insurance: Choosing Cover and Setting the Insured Basis

Key figures (free to quote)

Item	Reference figure
Jakarta (Tanjung Priok) standard clearance	2-4 working days (complete documents, no inspection).
Jakarta inspection (yellow line)	3 working days standard + 7 working days inspection.
Jakarta red line	3 working days standard + 10 working days red-line handling.
Semarang (Tanjung Emas) standard clearance	2-4 working days.
Surabaya (Tanjung Perak) standard clearance	2-4 working days.
PIB filing to SPPB release	1-3 working days.
Import duty (BM)	Typically 0-15% depending on HS code; FORM E / ACFTA brings most lines to 0%.
PPN (VAT)	Effective 11% (statutory 12%; non-luxury goods taxed on an 11/12 base).
De minimis for duty	Goods valued under USD 3 are duty free (PPN still applies).

Reference values for standard cases (complete documents, no inspection, outside the red-line season). Actual figures follow current carrier and customs notices. Last reviewed 2026-09-27.

In short

Insurance answers “will it be paid, and how much” — not “will something go wrong”. Its value appears on the day of the loss, which is why reading the clauses correctly when buying is far more useful than arguing afterwards.
Order of decisions: identify what this cargo most fears → pick the matching basic cover → add the additional cover you need → then set the insured amount and the deductible. Get the order wrong and you can end up with cover that looks complete and pays nothing.
The deductible and the exclusions deserve a closer read than the insured amount. Those are the clauses that actually decide whether a claim is paid.

1. How basic cover and additional cover divide

Two things are easily misread. First, “All Risks” does not mean everything is paid — it still carries exclusions and conditions. Second, additional cover is not a case of more is better: additional risks unrelated to the cargo’s real exposure simply buy extra premium.

Category	What it covers	What to weigh
FPA (basic)	Mainly loss from major casualties connected with the vessel; certain particular average is excluded.	Comparatively narrow — suited to cargo with a small exposure, or cargo covered by other arrangements.
WPA (basic)	Extends FPA to cover particular average arising from certain natural calamities.	Wider than FPA; the usual middle option on this trade.
All Risks (basic)	Extends FPA to cover loss from general external causes.	Widest cover — but “All Risks” is not “everything”; clauses and exclusions still bite.
General additional risks	Target specific external perils: breakage, leakage, sweat and heating, bursting of packing, and similar.	Add by cargo characteristics. Buying more than the cargo needs is not better.
Special additional risks	Target special perils such as war and strikes.	Whether to add depends on the route and on contract or letter-of-credit requirements.
Special cover	Arranged for particular risks of a specific commodity.	Confirmed case by case against the cargo and the route.

2. Setting the insured amount and the deductible

The insured amount has to align with the trade term. It is usually taken as the invoice value or the CIF value plus an agreed uplift, with the uplift percentage set by the contract and the letter of credit. This must be verified shipment by shipment — never carried over from the previous one.
The uplift exists to cover expected profit and part of the indirect cost, because a loss after the event costs more than the goods alone. How much uplift is a commercial agreement and belongs in the contract or the L/C.
The deductible is a “you carry the first part” mechanism. An absolute deductible is deducted from every loss; a relative (franchise) deductible stops applying once the loss passes a threshold. The policy wording governs.
Read the deductible’s unit and calculation method carefully: is it an amount or a percentage, per accident or per shipment. A misreading here changes the settlement directly.
Read the exclusions line by line. Typical directions include inadequate packing, inherent vice of the cargo, natural shrinkage, and market loss caused by delay — precisely the reasons many claims are refused.

3. When insurance is compulsory

The trade term decides who carries transit risk. Under terms where the buyer bears the risk (CIF-type), the seller normally arranges cover; where the buyer bears the risk (FOB / CFR-type), the duty to insure sits on the buyer’s side.
Where the contract or the L/C requires an insurance document to be presented, cover is not optional. The title, the risks covered, the sum insured and the uplift must then match the L/C exactly, or the documents will be discrepant.
High-value, fragile cargo, or cargo needing several transhipments, is usually worth insuring. The exposure scales with the number of handling stages — the more stages, the stronger the case.
Even when it is not required, quote the insurance cost explicitly. Letting the customer decide with the cost in front of them is cheaper than explaining afterwards.
Our position: do not make insurance the place where you save money by default. The premium saved and the loss from a single incident are not on the same scale.

4. Evidence to preserve after a loss

What to keep	Why it matters	Watch out
On-site images and a written record	Proves the condition and extent at the time of loss	Record while the cargo’s condition is still untouched
Survey or notarial report at the destination port	Objective basis for the extent and cause of loss	Issued by a qualified body following procedure
B/L, invoice, packing list and other documents	Proves the identity of this shipment with the insured cargo	Consistent with what was submitted at inception
Correspondence on the claim	Proves the notice and handling were timely	Keep important exchanges on a channel that retains records
Handover record between consignee and carrier	Establishes at which stage the loss occurred	Record the cargo’s condition honestly at handover

Handling a loss runs on documents. For the field-by-field basis see the document consistency page.

5. Common mistakes

Assuming “All Risks” pays for everything. It still carries exclusions and conditions; inadequate packing and inherent vice are routinely overlooked.
Writing the sum insured by habit instead of checking the contract or the L/C. A mismatched uplift can be rejected at document presentation — or leave the claim underpaid.
Ignoring the deductible. If the loss sits below it, nothing is paid — and this is the point most easily missed when buying.
Moving the cargo before collecting evidence. Once the cargo’s condition changes, extent and cause become hard to establish objectively.
Notifying late. Notice and handling after a loss carry their own requirements; delay harms the claim.
Insurance details inconsistent with the other documents. A mismatch in description, quantity, value or voyage invites a challenge on identity at claim stage.

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This page summarizes field practice and publicly available Indonesian import rules for general business reference only—it is not legal, customs, or pricing advice. Customs provisions, tariff rates, and licensing requirements keep changing, so the rules in force at the time and the official processing result always prevail. Wuhan Freedom International Logistics Co., Ltd. · Licensed PPJK in Indonesia · Jakarta / Semarang / Wuhan.

Marine Cargo Insurance: Basic and Additional Cover, and How to Set the Insured Basis