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KINDS OF PERILS : The cargo insurance policy can be as wide as to cover all possible kinds of risk and losses to which cargo could be exposed in transit. The event which lead to loss or damage to the cargo are the perils against which insurance cover can be obtained. Those perils may be categorised into four groups. Let us discuss them in detail.
These perils are the ones to which cargo is exposed in transit and caused by either an Act of God (i.e., a natural calamity) or an Act of Man (man-made event, either through negligence or through connivance). The perils may occur while the cargo is in transit on land, inland water, sea or in air. An act of God may also be described as "extraordinary and violent action of waves and winds". Common examples of Act of God are: earthquake, volcanic eruption and lightening, entry of sea water into the Vessel, washing overboard of cargo and rainwater damage. Common examples of man-made perils are file, explosion, smoke and water used to extinguish fire, piracy, barratry and deliberate (i.e, vandalism, sabotage, arson or scuttling).
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