DEFINITION of 'Voyage Policy'
A financial protection plan that provides coverage for goods in transit by sea. In order for a voyage policy to be valid, the vessel transporting the cargo must be in good condition and capable of making the journey, and the vessel's crew must be competent. This requirement exists because a voyage policy, like any insurance policy, is intended to protect against unforeseen risks, not against preventable risks. Voyage policies are important in the export business. A voyage policy may also be called "marine cargo insurance."
BREAKING DOWN 'Voyage Policy'
In addition to the seaworthiness exclusion described above, a voyage policy will also exclude losses caused by willful misconduct, ordinary leakage, ordinary wear and tear, improper or inadequate packaging, labor strikes and acts of war. Also, the policyholder may need to purchase additional insurance to cover the cargo during the entire transport process. Voyage policy may not cover a loss that occurs while the goods are being loaded onto the ship, for example.