Open Cover and Floating Policy
How traders insure shipments by declaration under an open cover or floating policy, MIA 1906 s.29, and the basis of valuation clause.
An open cover or floating policy insures a trader’s shipments by declaration rather than by a separate policy per voyage. The Marine Insurance Act 1906 s.29 requires declarations in order of dispatch or shipment, covering all consignments within the cover, with the value honestly stated; a value declared only after notice of loss makes that declaration unvalued unless the policy provides otherwise (s.29(4)).
The full article will cover declaration mechanics, the basis of valuation clause, limits per conveyance, certificates issued under the cover, forwarder-held covers, and the equivalent rules in the 2025 PRC Maritime Code. The cargo insured value article covers how this topic affects the sum insured on a cargo policy.