What type of loss is typically excluded in an Inland Marine policy due to its nature?

Inland Marine policies primarily cover risks associated with property in transit or certain types of movable property. Indirect losses, also known as consequential losses, refer to losses that are not a direct result of a specific event but instead arise as a consequence of a direct loss. For example, if a shipment of goods is damaged during transport, the direct loss would be the value of the goods. However, if the business suffers a loss of income due to not being able to sell those goods, that would be an indirect loss.

Typically, Inland Marine policies are designed to cover direct losses related to the property rather than the subsequent impacts of those losses, which are classified as indirect losses. This distinction is crucial because properties covered under Inland Marine are often transient or specially designated, leading to policies being tailored toward their specific risks without the inclusion of indirect impacts.

Moral hazards, which refer to the increased risk of loss due to the behavior of the insured after obtaining insurance, are also not the primary focus of Inland Marine policies. Instead, their intent is to underwrite specific types of property exposures. The nature of Inland Marine policies is to provide direct financial protection against loss or damage to property, aligning with the correct identification that indirect losses are typically excluded.