Insurance Application

Insurance Application is, in foreign trade practice, a written offer submitted by the applicant to an insurance company to conclude an insurance contract, usually filled out and submitted by the insured. Its main usage scenarios include: when the seller is responsible for insurance under CIF or CIP terms, or when the buyer arranges insurance on its own, the insurance application is submitted to the insurance company before shipment of the goods, specifying information such as the name of the goods, quantity, insured amount, risks covered, shipping route, and sailing date. Precautions: the contents of the insurance application must be strictly consistent with documents such as the letter of credit, bill of lading, and invoice, especially the insured amount (usually 110% of the invoice value), the risks covered (such as All Risks and With Particular Average), and the place of claim payment; the insurance application is not a formal policy, and the contract is established only after the insurance company accepts it and issues the policy. Differences from other terms: the insurance application is the application document in the insurance process, while the Insurance Policy is the formal contractual certificate, and the Certificate of Insurance is a simplified proof; in addition, an open insurance application is used for long-term cooperation, while a specific insurance application is used for a single transaction. Foreign trade practitioners should ensure that the insurance application is submitted in a timely manner to avoid retroactive issues regarding insurance liability caused by arranging insurance after shipment of the goods.