Insurance for Shipping a Car Overseas

The two types of international car shipping insurance are total loss for replacement, and all risk coverage for other damage. Take pictures of your car to make filing an international car shipping insurance claim easier.

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A former insurance producer, Laura understands that education is key when it comes to buying insurance. She has happily dedicated many hours to helping her clients understand how the insurance marketplace works so they can find the best car, home, and life insurance products for their needs.

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Written by Laura Berry
Former Insurance Agent Laura Berry

Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP® Joel Ohman

UPDATED: Jun 2, 2022

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Here's what you need to know...

  • While shipping your vehicle overseas, it is important to get coverage that protects it along the way from events such as fire, theft, or wrecking of the ship
  • Before shipping your car, you may consider speaking with your insurance agent and ask for advice on the best coverage
  • Remember to take photos of the car before releasing it for shipping; pictures help while filing a claim in case the need arises

You may be traveling to a different country for work or holiday, and you may need to take your car with you. There are a few methods of transport that one can use. Most travelers would consider shipping their vehicles rather than flying them into the country of destination to save on the costs.

Shipping officials require you to provide the necessary documents before shipping your car out of the country. With said documents however, someone can perform international transports with ease. All that’s left is to figure out whether or not you want insurance when you’re shipping vehicles.

It is not a legal requirement to obtain an insurance policy while shipping your vehicle, although having one would be a wise idea. Insurance coverage while shipping overseas covers damage and theft of the vehicle during transit.

If you are traveling overseas soon with your car, start comparison shopping today for better auto insurance rates to protect you and your car along the way. We have a free comparison tool that will let you compare quotes from different companies.

What are the risks involved?

Cars on a ship are susceptible to damage from inclement weather in the sea as well as attack from the pirates. Flooding may also occur in the ship causing damage to the upholstery on the car and other parts of a vehicle.

Additionally, a car may not be properly stowed, causing damage to the other vehicles, especially if the vehicles are on roll-on-roll-off vessels during shipping.

A policyholder should get compensations for damages while on transit, such as:

  • Fires
  • Breakages
  • Dents on a car
With the type of coverage necessary keeping things such as dents and other damage from coming out of your own pockets, you may want to consider the variety of factors that go into determining whether your car will be safe in transit. Accidents do happen, and when it comes to shipping cars, it may be better to be safe rather than sorry.

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What are the methods of shipping a car?

There are two common methods of transporting vehicles in a ship. They include the containerized shipping and the roll-on-roll-off vessels.

  • Containerized Shipping – The shippers place the vehicles in containers to ensure maximum security of the vehicles. Up to six cars fit in a 40-inch container.
  • Roll on-Roll Off Method – The workers secure vehicles inside the ships to their car decks. Although this is an easy and cheap way, it is highly prone to theft and damages.

Insurance companies will consider the method of shipping while calculating the average cost you will pay for coverage. The higher the risk with the shipment, the higher the cost will be. Container shipping might come out ahead, even if it’s the more expensive option. Customers may want to consider the costs of additional coverage when looking into international car transport.

Insurance for Shipping Cars

Shipping your vehicle to foreign countries, as mentioned above, does come with its own set of risks. This is why it’s vital to figure not just your shipping options, but your insurance coverage as well.

An insurance company would cover any damage that occurs to a vehicle from when it moves out of the warehouse on its way to the terminal. Coverage is still in effect during the transportation, and it ends the moment you pick up the vehicle.

The insurance policy does not cover the personal effects loaded in a car, and they would not compensate in case of loss or damage.

Insurance companies provide two types of coverage to policyholders shipping their cars overseas. The difference will be dependent on the type of coverage needed while the vehicle is in transit.

These two types include all risk and total loss. The premiums for all risk are slightly higher than the former, but might be worth the additional costs. With both types, the vehicle owner has to pay a deductible, which has an influence on the typical cost and what will be owed.

  • Total loss – Covers theft, fire, or complete loss of the entire shipment. In this case, the insurers replace the car with another one or offer a cash settlement of the total value.
  • All risk insurance – Covers all damages that occur from the moment of loading, through transit, and ends at the arrival to the final destination. The settlement may either cover the repairs or offer a cash settlement (which is based on the current product value in the market) to cater for the cars destroyed.

Keep in mind that the coverage for all risk insurance only applies to the cars packed by a professional worker on the ship.

Talk to Your Insurance Provider

You should consider speaking to your insurance provider before getting insurance for shipping a car overseas. An insurance provider would advise you on the way forward in case they do not provide the coverage you need.

Additionally, your insurer may not provide coverage when driving your car in another country.

You will then need to get an international insurance policy in addition to the shipping insurance that expires the moment your car leaves the dock. The international coverage allows you to drive in the country of destination.

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What should you consider before purchasing insurance?

There are a few ways you can go about obtaining coverage for the vehicles you’re going to be shipping overseas. Naturally you’ll be focusing on shipping rates and international car transport companies, but you should also look closer to home as well. Finding solid rates and whether or not your current insurer offers the coverage you need will help you in the long run.

Shop for Quotes

Before settling on a company that will be able to provide you with transportation coverage, you should consider comparison shopping. Satisfied customers are those that are offered options, so it’s in your best interest to see what’s out there, and find the best deal. Rates vary from one company to another, which means it might be easy to find a better rate than what you currently pay. This can be especially helpful if your current provider doesn’t offer coverage for a vehicle being shipped overseas.

Investigate Your Insurance Policy

Understanding your insurance coverage is a great way to prepare for your trip. As mentioned above, this will be what determines where you’ll get a policy, as well as how much of your vehicle will be covered. You should consider checking on whether your current policy covers damages that may occur during the loading and offloading of your vehicle. You should avoid purchasing coverage from a company that fails to provide details regarding any sort of policy.

Take Photos

Above anything else, take photos of your car before it gets loaded onto a ship or into a container. This is just in case you need to make a claim. The photos stand as evidence of the car’s condition before shipment. That way, if your car suffers any damage, you’ll be able to prove it happened while loaded onto a ship.

In Conclusion

While shipping is a safe method of transporting vehicles, purchasing an insurance policy should be considered necessary to ensure you don’t end up having to pay for anything else out of pocket.

However, some insurance providers may require you to pay for the minor damages on the vehicle such as dents or chipping of paint which helps in retaining the low rates of the insurance premiums.

Looking for better auto insurance rates before hitting the high seas? Don’t forget about our comparison tool, which will help you to compare quotes from various companies.

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Enter your ZIP code below to view companies that have cheap car insurance rates.

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