Import Duty Risk

Import Duty Risk is an additional risk under cargo transportation insurance. It covers the loss incurred when goods are damaged during transit, causing the customs of the importing country to levy duties based on the damaged value rather than the sound value, while the insured is still required to pay duties based on the sound value. This is commonly seen in situations where goods are damaged at the destination port but customs duties are not reduced or exempted, such as in some countries where duties are assessed on the sound value of the goods. Usage scenarios: When an exporter or importer insures cargo transportation, if they are concerned that they may still bear high import duties after the goods are damaged, they may add this coverage. Precautions: This risk usually cannot be insured separately and must be attached to the main coverage (such as All Risks); compensation is limited to the difference between the duties actually paid and the duties payable based on the damaged value; customs policies vary greatly among countries and must be confirmed in advance. Difference from other terms: It differs from ordinary cargo transportation insurance, which only compensates for the loss of the goods themselves and not for duty losses; it also differs from customs duty guarantee insurance, which mainly guarantees the obligation to pay customs duties.