The Multimodal Transportation of Goods Act, 1993 provides for legal liability for loss or damage to cargo. It provides for the creation of a licensed operator called the MTO who could be held responsible for the loss or damage to the cargo entrusted to them for transportation. One of the requirements of the MTO license is the insurance to cover liability that arises on them. MTO is liable for (a) Act for their Principal I arranging shipping and transport services, or (b) Contract with the cargo owner to transport goods; or (c) Provide expert advice, assistance and opinions. Although the MTO came into effect in 1993 Indian insurers were not providing this cover till 2001. Currently few insurers are offering this cover in the market. In the light of above Ministry of Finance had given special dispensation allowing foreign insurers to directly underwrite this business. Coverage : To cover insured’s liability to (a) A customer or third party for loss or damage to cargo in the insured’s care, custody or control (ii) A third party for death, bodily injury or damage to property (c) A customer or third party for errors and omissions or professional negligence (iv) An Authority for fines and duty. Cargo Liability : Indemnity is provided to the insured for its legal liability an claims expenses in respect of claims which arise from physical loss of or physical damage to cargo provided such liability arise from The Indian Multimodal Transport Act, FIATA or Combicon Bill of Lading or the Insured’s house bill of lading or standard trading conditions or other recognized transport convention. Third Party Legal Liability : Indemnity is provided to the insured for its legal liability in respect of a claim arising from an accident causing (i) Bodily injury to a third party, or (ii) Physical loss or physical damage to third party property, or (iii) Consequential loss suffered by a third party. Professional Indemnity : Usually an add on extension. Covers the legal liability and expenses arising from (i) The negligent performance of a professional duty, (ii) Fraud by an employee (iii) Libel, slander or infringement of personal rights that has not arisen from publication in an independent journal etc (iv) An unintentional breach of warranty of authority where the insured has contracted on another person’s behalf believing they have the authority to do so.(v) A misdirected claim against the insured being one which results from (a) an accident for which legal liability would in the normal course of vessel operations be covered by any protection and indemnity policy for the vessel owner or operator, or (b) A contract into which the insured entered, within the scope of the insured services believing that the insured was acting as the principal’s agent only. Fines and Duties : This too is an extension if opted for. Rating : (a) Gross Freight Receipts (GFR), (b) The number of containers handled (in terms of 20 TEU). The rate shall depend on (i) Limit of liability for cargo and TP Liability (ii) Extensions Opted (iii) Deductibles (iv) Past claims experience (v) Nature of cargo handled (vi) Destination of Cargo e.g., the % of cargo normally dealt with towards USA/South America/Eastern Europe/Africa etc. (vii) Quality of Management.