|*Transporting the merchandise safely to its destination is entrusted to various logistics service providers. However, how secure are their transport facilities and what happens when a loss in transit occurs? How fast and easy is the process to get back the claim? What is the Indian jeweller’s perception of risk? {{Diamond World}} endeavoured to find out...*|

{{THE INDIAN LOGISTICS INDUSTRY :}}%% First, it is vital to know about the precious goods logistic industry in India. While logistic companies specialising in valuables in the west are nearly more than a century old, in India the first logistic company started in 1981. {{Brinks Inc.}} a US based company, entered India through a joint venture in July 1981 to form the {{Brinks Arya India Private Limited,}} headed by {{Krishna B Kotak. Lemuir Express}} later on followed them in 1983. At that time, the logistic services were mainly offered to the diamond industry. In addition, a few traditional jewellers exported their merchandise once or twice a year. $$ Today, the major players in the gems and jewellery logistics business are {{JK Malca-Amit , Brinks Arya, B V Chinai (also known as BVC)and Lemuir Express.}} All the four logistics providers are located in the same premises where the Mumbai Customs Airport Commissionerate is located on Lamington Road. The player with the major chunk of this business is JK Malca-Amit with an estimated 42 per cent share. While Brinks Arya has an approximate 28 per cent and BVC holds 22 per cent of the market share, the rest of the market is dominated by Lemuir and other players. Around 95 per cent of the gems and jewellery exporters avail of the services provided by these logistic houses. Charges for armoured vehicle, airlines, service tax, and strong room prevail besides the customs paper work. Nonetheless there is stiff competition related to the services and discounts in charges offered, thereby benefiting the jeweller.%% {{SECURITY DURING TRANSIT :}}$$ For an industry that is high in both value and risk, it is but natural that security during transportation is of immense importance. Armoured vehicles with {{Global Position Systems}} (GPS), business information tracking systems and a minimum of two armed gunmen are the measures taken to safeguard the valuables during transit.

{{Armoured Vehicles :}}$$ Vehicles for transporting valuables comprise cash vans and bulletproof vehicles. In India, Brinks Arya leads with 350 vehicles out of which an approximate 80 to 90 vans are bulletproof. Following them is BVC with 35 armoured vehicles. JK Malca-Amit and Lemuir statistics were not available. $$ Globally armoured vehicles for valuables are graded on a scale of one to five – five being the highest. The vehicles are made according to the stringent norms set by international standards and the logistics company’s insurance provider. Bulletproof glass, stronger metal, GPS system, etc are some of the features found in armoured vehicles. Says {{Udai Chinai, Chairman & Managing Director, BVC,}} |*“There are instances where one puts grill on a simple cargo van and calls it a cash van! However, for valuables, that is not allowed. There are certain criteria for making armoured vehicles like at least thick bulletproof glass, high quality meta|. Unless the criteria are fulfilled, insurance companies refuse to insure the vehicle.” *| BVC, among its armoured vehicles, has two customised vehicles with high security systems and costing Rs.10 lakh each .%% Possessing the highest number of armoured vehicles in India, Brinks Arya ensures its vehicles are in running condition at all times. {{Dinesh Shah, advisor for diamond jewellery, Brinks Arya}} says, |*“The quality of the cash vans is upto the mark. The security department from Brinks Inc designs the vehicles and decides on the material used. Daily we examine the vehicles. If some fault is discovered in the vehicle, it is sent to the garage with immediate effect.” *|%% Nonetheless, as the rate of looting valuables in the country is lesser as compared to certain other countries, there is a huge difference in the built and glass thickness used in Indian vehicles. Says {{Udai Chinai,}} |*“As the crime rate for robbery of valuables in certain countries are high, the standards set for the armoured vehicle would be high. Weighing a minimum of one tonne the van would have bulletproof glass measuring one inch thick and the door supporting that glass would be around 800 kilos.”*| He further adds, |*“In India, as the crime rate is not high regarding looting, most armoured vehicles consist of bulletproof glass of 2, 3 or even 5mm and doors weighing around 20 to 30 kilos.” *|%% As compared to other countries where a charge is put for using armoured vehicles, in India the service is either complimentary with the other services it provides such as customs clearance, forwarding, etc. or offered at a discounted rate.

{{Gunmen & Ammunition :}}$$ The personnel transporting the merchandise back and forth in the armoured vehicle comprise the driver, navigator and gunmen. Albeit not being a hard and fast rule, a minimum of two armed gunmen is recommended. The gunmen are normally ex-army men who are recruited only after police verification and registered with the concerned local authorities. For the ammunition, which includes licensed rifles and bullets, there is a constant check to replenish any shortage of stock. While some of the companies hire third party security force and ammunition, Dinesh Shah quotes, |*“Brinks Arya does not depend on any third party security force for protecting its armoured vehicles. All the gunmen are part of the Brinks Arya payroll and the license for ammunition is in Brinks Arya’s name.”*|%% {{IN CASE OF LOSS :}}%% {{Under The Global Insurance Umbrella :}}$$ Though loss in transit is a rare case in the thirty years of the Indian precious merchandise logistics industry history, each of the four companies are tied up with international security service providers and are covered under Global Insurance. While BVC are now associates of Group 4 Security International (G4S) and are covered under G4S $200 million global insurance cover, Brinks Arya pays up to $50 million on loss of cargo. Most of the time, the logistic companies settle the claims with their clients in 24 hours or within four days, depending on each incident. The companies later on work it out on getting the money back with their insurance companies. $$ On an average with minimal paperwork, which comprises a claim loss receipt (a document that states the details about how the loss occurred) from the airline, the logistic companies receive their money back within a month. %% {{Other Insurance Policies :}}$$ Sometimes due to the customer’s insistence and the low value of the merchandize to be sent, the shipment could be sent via players like FedEx, DHL, etc. In such a situation, the customer is responsible for the risk of his cargo and has to apply for marine cargo insurance.

{{TAKING & CLAIMING MARINE CARGO INSURANCE :}}$$ Marine cargo insurance covers physical damage to, or loss of all types of goods while in transit by road, rail, sea and air. In India there are around 21 companies issuing marine cargo insurance. The gems and jewellery segment is considered high risk due to its value and size. If a packet were lost, then one would be looking at values of few millions. The insurance industry does reckon caution while issuing marine cargo policy to the jewellery industry. Not everyone in the industry is allowed to underwrite a marine cargo policy for the jewellery industry. Most of the insurance companies provide the insurance directly to the gems and jewellery fraternity and not to the logistics providers. %% {{Applying for Insurance :}}$$ According to a highly reliable source (who did not want to be named) while there is no specific policy for jewellery industry, the exporter needs to declare the value of the goods and what they are carrying to the carrier. This is in order for the carrier (be it courier or logistic company) takes extra care while transporting the cargo and will be responsible if there is an incident. %% The exporter, while applying for a marine insurance policy, has to give one or two sheets of information to the insurance company. To estimate the value for the insurance policy, the proposer needs to provide an invoice to the insurance company. The basis of valuation, which is the contents of the invoice, is {{cost, insurance and freight (CIF) plus incidentals up to a percentage which is agreed upon at the inception of the policy ( normally this is 10 %).}} Apart from the invoice, standard questions related to the exporter’s turnover, the value of the export, the carrier transporting the shipment, the security measures taken, his insurance claim history are asked. On assessment of the risk, the insurance company deems it fit to issue the policy and the type of policy to the exporter.

{{While Seeking Claims :}}$$ In case of loss of the merchandise, the following steps have to be taken: {[Take the immediate steps to minimise loss.]} {[Inform the insurance company or the claim-settling agent mentioned in the policy. ]} {[In case of damage to goods whilst on ship or in port, arrange for joint ship survey or port survey. ]} {[Lodge monetary claim with carrier within the stipulated time (proof of protection of recovery right). ]} {[Submit the duly assigned insurance policy or certificate along with the original invoice and other documents required to substantiate the claim such as {[Bill of Lading/ Air waybill (AWB)/ declaration with details despatched with GR no. given to the insured ]} {[Packing list]} {[Copies of correspondence exchanged with carriers. ]} {[Copy of notice served on carriers along with acknowledgement or receipt. ]} {[Shortage or damage certificate issued by carrier as whether the goods were lost, damaged or non-delivered. ]} {[Survey report, which is the investigation report on how the loss could have occurred.]} ]} Once the insured fulfils the above mentioned requirements, the insurance company steps in, pays the claim, and proceeds against the entity that has caused the loss to enable the insurance provider to recover as much.

{{Pre-cautionary Duties:}}$$ There are two reasons where one normally is stuck with documentation and the case of getting claims drags for a long period. It is the lack of awareness and responsibility about being insured. People need to understand what insurance is all about. It is not just about premium and claiming from policies. They need to know what are the duties cast on them if there is an incident. In addition, they need to act in a prudent manner while choosing their carrier, ensuring security, declaring correct value and paying more freight. %% While applying for marine cargo policy, the exporter should insist from the insurance underwriter details about what and how much of the cargo will be covered and what exactly has to be done at the time of a claim. On clearing one’s doubts about the insurance policy, the exporter should finalise the premium. As a rule, insurance companies provide a {{red slip}} containing the dos and don’ts in marine cargo insurance attached to the policy documents. %% On discovering that the insured has untruthfully declared his claims history, the insurance company could terminate the insurance policy because of bad faith. In addition, declaring the correct value of the goods to the carrier would help. The courier would charge a nominal amount for the packet at the time of sending. However, if the merchandise were lost, then the courier would give what is his per packet liability of Rs. 50. In addition, the insured would be stuck with the insurance company and the claim could drag on for years to the detriment of the exporter.%% If the proper documentation is done, it does not take much time to get back the claim. Besides, the insurance company provides guidance on finer issues like sending through particular logistic or courier companies, etc. %% {{Time to Sit Up & Be Cautious :}}$$ While 95 per cent of the jewellery industry in India uses the armoured vehicle services, there are times when the jeweller puts the packet containing valuables in his pocket and walks or travels in a cab or train to either the logistics office or the airport. Experts believe that as the Indian economy improves, there is a probability of organised robbery of valuables to creep in and making the man with valuables worth crores in his pocket an easy target. %% {{Risk Increasing :}}$$ However, things do not stop there. As looting jewellery and mugging people for valuables begins to rise, a vicious cycle starts with the exporter losing his valuables to his customer never receiving his order. This in the process would affect businesses. It is high time when people sit up and think of new business strategies to create a safe system that would last for at least a hundred years.

|*Transporting the merchandise safely to its destination is entrusted to various logistics service providers. However, how secure are their transport facilities and what happens when a loss in transit occurs? How fast and easy is the process to get back the claim? What is the Indian jeweller’s perception of risk? {{Diamond World}} endeavoured to find out...*|

{{THE INDIAN LOGISTICS INDUSTRY :}}%% First, it is vital to know about the precious goods logistic industry in India. While logistic companies specialising in valuables in the west are nearly more than a century old, in India the first logistic company started in 1981. {{Brinks Inc.}} a US based company, entered India through a joint venture in July 1981 to form the {{Brinks Arya India Private Limited,}} headed by {{Krishna B Kotak. Lemuir Express}} later on followed them in 1983. At that time, the logistic services were mainly offered to the diamond industry. In addition, a few traditional jewellers exported their merchandise once or twice a year. $$ Today, the major players in the gems and jewellery logistics business are {{JK Malca-Amit , Brinks Arya, B V Chinai (also known as BVC)and Lemuir Express.}} All the four logistics providers are located in the same premises where the Mumbai Customs Airport Commissionerate is located on Lamington Road. The player with the major chunk of this business is JK Malca-Amit with an estimated 42 per cent share. While Brinks Arya has an approximate 28 per cent and BVC holds 22 per cent of the market share, the rest of the market is dominated by Lemuir and other players. Around 95 per cent of the gems and jewellery exporters avail of the services provided by these logistic houses. Charges for armoured vehicle, airlines, service tax, and strong room prevail besides the customs paper work. Nonetheless there is stiff competition related to the services and discounts in charges offered, thereby benefiting the jeweller.%% {{SECURITY DURING TRANSIT :}}$$ For an industry that is high in both value and risk, it is but natural that security during transportation is of immense importance. Armoured vehicles with {{Global Position Systems}} (GPS), business information tracking systems and a minimum of two armed gunmen are the measures taken to safeguard the valuables during transit.

{{Armoured Vehicles :}}$$ Vehicles for transporting valuables comprise cash vans and bulletproof vehicles. In India, Brinks Arya leads with 350 vehicles out of which an approximate 80 to 90 vans are bulletproof. Following them is BVC with 35 armoured vehicles. JK Malca-Amit and Lemuir statistics were not available. $$ Globally armoured vehicles for valuables are graded on a scale of one to five – five being the highest. The vehicles are made according to the stringent norms set by international standards and the logistics company’s insurance provider. Bulletproof glass, stronger metal, GPS system, etc are some of the features found in armoured vehicles. Says {{Udai Chinai, Chairman & Managing Director, BVC,}} |*“There are instances where one puts grill on a simple cargo van and calls it a cash van! However, for valuables, that is not allowed. There are certain criteria for making armoured vehicles like at least thick bulletproof glass, high quality meta|. Unless the criteria are fulfilled, insurance companies refuse to insure the vehicle.” *| BVC, among its armoured vehicles, has two customised vehicles with high security systems and costing Rs.10 lakh each .%% Possessing the highest number of armoured vehicles in India, Brinks Arya ensures its vehicles are in running condition at all times. {{Dinesh Shah, advisor for diamond jewellery, Brinks Arya}} says, |*“The quality of the cash vans is upto the mark. The security department from Brinks Inc designs the vehicles and decides on the material used. Daily we examine the vehicles. If some fault is discovered in the vehicle, it is sent to the garage with immediate effect.” *|%% Nonetheless, as the rate of looting valuables in the country is lesser as compared to certain other countries, there is a huge difference in the built and glass thickness used in Indian vehicles. Says {{Udai Chinai,}} |*“As the crime rate for robbery of valuables in certain countries are high, the standards set for the armoured vehicle would be high. Weighing a minimum of one tonne the van would have bulletproof glass measuring one inch thick and the door supporting that glass would be around 800 kilos.”*| He further adds, |*“In India, as the crime rate is not high regarding looting, most armoured vehicles consist of bulletproof glass of 2, 3 or even 5mm and doors weighing around 20 to 30 kilos.” *|%% As compared to other countries where a charge is put for using armoured vehicles, in India the service is either complimentary with the other services it provides such as customs clearance, forwarding, etc. or offered at a discounted rate.

{{Gunmen & Ammunition :}}$$ The personnel transporting the merchandise back and forth in the armoured vehicle comprise the driver, navigator and gunmen. Albeit not being a hard and fast rule, a minimum of two armed gunmen is recommended. The gunmen are normally ex-army men who are recruited only after police verification and registered with the concerned local authorities. For the ammunition, which includes licensed rifles and bullets, there is a constant check to replenish any shortage of stock. While some of the companies hire third party security force and ammunition, Dinesh Shah quotes, |*“Brinks Arya does not depend on any third party security force for protecting its armoured vehicles. All the gunmen are part of the Brinks Arya payroll and the license for ammunition is in Brinks Arya’s name.”*|%% {{IN CASE OF LOSS :}}%% {{Under The Global Insurance Umbrella :}}$$ Though loss in transit is a rare case in the thirty years of the Indian precious merchandise logistics industry history, each of the four companies are tied up with international security service providers and are covered under Global Insurance. While BVC are now associates of Group 4 Security International (G4S) and are covered under G4S $200 million global insurance cover, Brinks Arya pays up to $50 million on loss of cargo. Most of the time, the logistic companies settle the claims with their clients in 24 hours or within four days, depending on each incident. The companies later on work it out on getting the money back with their insurance companies. $$ On an average with minimal paperwork, which comprises a claim loss receipt (a document that states the details about how the loss occurred) from the airline, the logistic companies receive their money back within a month. %% {{Other Insurance Policies :}}$$ Sometimes due to the customer’s insistence and the low value of the merchandize to be sent, the shipment could be sent via players like FedEx, DHL, etc. In such a situation, the customer is responsible for the risk of his cargo and has to apply for marine cargo insurance.

{{TAKING & CLAIMING MARINE CARGO INSURANCE :}}$$ Marine cargo insurance covers physical damage to, or loss of all types of goods while in transit by road, rail, sea and air. In India there are around 21 companies issuing marine cargo insurance. The gems and jewellery segment is considered high risk due to its value and size. If a packet were lost, then one would be looking at values of few millions. The insurance industry does reckon caution while issuing marine cargo policy to the jewellery industry. Not everyone in the industry is allowed to underwrite a marine cargo policy for the jewellery industry. Most of the insurance companies provide the insurance directly to the gems and jewellery fraternity and not to the logistics providers. %% {{Applying for Insurance :}}$$ According to a highly reliable source (who did not want to be named) while there is no specific policy for jewellery industry, the exporter needs to declare the value of the goods and what they are carrying to the carrier. This is in order for the carrier (be it courier or logistic company) takes extra care while transporting the cargo and will be responsible if there is an incident. %% The exporter, while applying for a marine insurance policy, has to give one or two sheets of information to the insurance company. To estimate the value for the insurance policy, the proposer needs to provide an invoice to the insurance company. The basis of valuation, which is the contents of the invoice, is {{cost, insurance and freight (CIF) plus incidentals up to a percentage which is agreed upon at the inception of the policy ( normally this is 10 %).}} Apart from the invoice, standard questions related to the exporter’s turnover, the value of the export, the carrier transporting the shipment, the security measures taken, his insurance claim history are asked. On assessment of the risk, the insurance company deems it fit to issue the policy and the type of policy to the exporter.

{{While Seeking Claims :}}$$ In case of loss of the merchandise, the following steps have to be taken: {[Take the immediate steps to minimise loss.]} {[Inform the insurance company or the claim-settling agent mentioned in the policy. ]} {[In case of damage to goods whilst on ship or in port, arrange for joint ship survey or port survey. ]} {[Lodge monetary claim with carrier within the stipulated time (proof of protection of recovery right). ]} {[Submit the duly assigned insurance policy or certificate along with the original invoice and other documents required to substantiate the claim such as {[Bill of Lading/ Air waybill (AWB)/ declaration with details despatched with GR no. given to the insured ]} {[Packing list]} {[Copies of correspondence exchanged with carriers. ]} {[Copy of notice served on carriers along with acknowledgement or receipt. ]} {[Shortage or damage certificate issued by carrier as whether the goods were lost, damaged or non-delivered. ]} {[Survey report, which is the investigation report on how the loss could have occurred.]} ]} Once the insured fulfils the above mentioned requirements, the insurance company steps in, pays the claim, and proceeds against the entity that has caused the loss to enable the insurance provider to recover as much.

{{Pre-cautionary Duties:}}$$ There are two reasons where one normally is stuck with documentation and the case of getting claims drags for a long period. It is the lack of awareness and responsibility about being insured. People need to understand what insurance is all about. It is not just about premium and claiming from policies. They need to know what are the duties cast on them if there is an incident. In addition, they need to act in a prudent manner while choosing their carrier, ensuring security, declaring correct value and paying more freight. %% While applying for marine cargo policy, the exporter should insist from the insurance underwriter details about what and how much of the cargo will be covered and what exactly has to be done at the time of a claim. On clearing one’s doubts about the insurance policy, the exporter should finalise the premium. As a rule, insurance companies provide a {{red slip}} containing the dos and don’ts in marine cargo insurance attached to the policy documents. %% On discovering that the insured has untruthfully declared his claims history, the insurance company could terminate the insurance policy because of bad faith. In addition, declaring the correct value of the goods to the carrier would help. The courier would charge a nominal amount for the packet at the time of sending. However, if the merchandise were lost, then the courier would give what is his per packet liability of Rs. 50. In addition, the insured would be stuck with the insurance company and the claim could drag on for years to the detriment of the exporter.%% If the proper documentation is done, it does not take much time to get back the claim. Besides, the insurance company provides guidance on finer issues like sending through particular logistic or courier companies, etc. %% {{Time to Sit Up & Be Cautious :}}$$ While 95 per cent of the jewellery industry in India uses the armoured vehicle services, there are times when the jeweller puts the packet containing valuables in his pocket and walks or travels in a cab or train to either the logistics office or the airport. Experts believe that as the Indian economy improves, there is a probability of organised robbery of valuables to creep in and making the man with valuables worth crores in his pocket an easy target. %% {{Risk Increasing :}}$$ However, things do not stop there. As looting jewellery and mugging people for valuables begins to rise, a vicious cycle starts with the exporter losing his valuables to his customer never receiving his order. This in the process would affect businesses. It is high time when people sit up and think of new business strategies to create a safe system that would last for at least a hundred years.

|*Transporting the merchandise safely to its destination is entrusted to various logistics service providers. However, how secure are their transport facilities and what happens when a loss in transit occurs? How fast and easy is the process to get back the claim? What is the Indian jeweller’s perception of risk? {{Diamond World}} endeavoured to find out...*|

{{THE INDIAN LOGISTICS INDUSTRY :}}%% First, it is vital to know about the precious goods logistic industry in India. While logistic companies specialising in valuables in the west are nearly more than a century old, in India the first logistic company started in 1981. {{Brinks Inc.}} a US based company, entered India through a joint venture in July 1981 to form the {{Brinks Arya India Private Limited,}} headed by {{Krishna B Kotak. Lemuir Express}} later on followed them in 1983. At that time, the logistic services were mainly offered to the diamond industry. In addition, a few traditional jewellers exported their merchandise once or twice a year. $$ Today, the major players in the gems and jewellery logistics business are {{JK Malca-Amit , Brinks Arya, B V Chinai (also known as BVC)and Lemuir Express.}} All the four logistics providers are located in the same premises where the Mumbai Customs Airport Commissionerate is located on Lamington Road. The player with the major chunk of this business is JK Malca-Amit with an estimated 42 per cent share. While Brinks Arya has an approximate 28 per cent and BVC holds 22 per cent of the market share, the rest of the market is dominated by Lemuir and other players. Around 95 per cent of the gems and jewellery exporters avail of the services provided by these logistic houses. Charges for armoured vehicle, airlines, service tax, and strong room prevail besides the customs paper work. Nonetheless there is stiff competition related to the services and discounts in charges offered, thereby benefiting the jeweller.%% {{SECURITY DURING TRANSIT :}}$$ For an industry that is high in both value and risk, it is but natural that security during transportation is of immense importance. Armoured vehicles with {{Global Position Systems}} (GPS), business information tracking systems and a minimum of two armed gunmen are the measures taken to safeguard the valuables during transit.

{{Armoured Vehicles :}}$$ Vehicles for transporting valuables comprise cash vans and bulletproof vehicles. In India, Brinks Arya leads with 350 vehicles out of which an approximate 80 to 90 vans are bulletproof. Following them is BVC with 35 armoured vehicles. JK Malca-Amit and Lemuir statistics were not available. $$ Globally armoured vehicles for valuables are graded on a scale of one to five – five being the highest. The vehicles are made according to the stringent norms set by international standards and the logistics company’s insurance provider. Bulletproof glass, stronger metal, GPS system, etc are some of the features found in armoured vehicles. Says {{Udai Chinai, Chairman & Managing Director, BVC,}} |*“There are instances where one puts grill on a simple cargo van and calls it a cash van! However, for valuables, that is not allowed. There are certain criteria for making armoured vehicles like at least thick bulletproof glass, high quality meta|. Unless the criteria are fulfilled, insurance companies refuse to insure the vehicle.” *| BVC, among its armoured vehicles, has two customised vehicles with high security systems and costing Rs.10 lakh each .%% Possessing the highest number of armoured vehicles in India, Brinks Arya ensures its vehicles are in running condition at all times. {{Dinesh Shah, advisor for diamond jewellery, Brinks Arya}} says, |*“The quality of the cash vans is upto the mark. The security department from Brinks Inc designs the vehicles and decides on the material used. Daily we examine the vehicles. If some fault is discovered in the vehicle, it is sent to the garage with immediate effect.” *|%% Nonetheless, as the rate of looting valuables in the country is lesser as compared to certain other countries, there is a huge difference in the built and glass thickness used in Indian vehicles. Says {{Udai Chinai,}} |*“As the crime rate for robbery of valuables in certain countries are high, the standards set for the armoured vehicle would be high. Weighing a minimum of one tonne the van would have bulletproof glass measuring one inch thick and the door supporting that glass would be around 800 kilos.”*| He further adds, |*“In India, as the crime rate is not high regarding looting, most armoured vehicles consist of bulletproof glass of 2, 3 or even 5mm and doors weighing around 20 to 30 kilos.” *|%% As compared to other countries where a charge is put for using armoured vehicles, in India the service is either complimentary with the other services it provides such as customs clearance, forwarding, etc. or offered at a discounted rate.

{{Gunmen & Ammunition :}}$$ The personnel transporting the merchandise back and forth in the armoured vehicle comprise the driver, navigator and gunmen. Albeit not being a hard and fast rule, a minimum of two armed gunmen is recommended. The gunmen are normally ex-army men who are recruited only after police verification and registered with the concerned local authorities. For the ammunition, which includes licensed rifles and bullets, there is a constant check to replenish any shortage of stock. While some of the companies hire third party security force and ammunition, Dinesh Shah quotes, |*“Brinks Arya does not depend on any third party security force for protecting its armoured vehicles. All the gunmen are part of the Brinks Arya payroll and the license for ammunition is in Brinks Arya’s name.”*|%% {{IN CASE OF LOSS :}}%% {{Under The Global Insurance Umbrella :}}$$ Though loss in transit is a rare case in the thirty years of the Indian precious merchandise logistics industry history, each of the four companies are tied up with international security service providers and are covered under Global Insurance. While BVC are now associates of Group 4 Security International (G4S) and are covered under G4S $200 million global insurance cover, Brinks Arya pays up to $50 million on loss of cargo. Most of the time, the logistic companies settle the claims with their clients in 24 hours or within four days, depending on each incident. The companies later on work it out on getting the money back with their insurance companies. $$ On an average with minimal paperwork, which comprises a claim loss receipt (a document that states the details about how the loss occurred) from the airline, the logistic companies receive their money back within a month. %% {{Other Insurance Policies :}}$$ Sometimes due to the customer’s insistence and the low value of the merchandize to be sent, the shipment could be sent via players like FedEx, DHL, etc. In such a situation, the customer is responsible for the risk of his cargo and has to apply for marine cargo insurance.

{{TAKING & CLAIMING MARINE CARGO INSURANCE :}}$$ Marine cargo insurance covers physical damage to, or loss of all types of goods while in transit by road, rail, sea and air. In India there are around 21 companies issuing marine cargo insurance. The gems and jewellery segment is considered high risk due to its value and size. If a packet were lost, then one would be looking at values of few millions. The insurance industry does reckon caution while issuing marine cargo policy to the jewellery industry. Not everyone in the industry is allowed to underwrite a marine cargo policy for the jewellery industry. Most of the insurance companies provide the insurance directly to the gems and jewellery fraternity and not to the logistics providers. %% {{Applying for Insurance :}}$$ According to a highly reliable source (who did not want to be named) while there is no specific policy for jewellery industry, the exporter needs to declare the value of the goods and what they are carrying to the carrier. This is in order for the carrier (be it courier or logistic company) takes extra care while transporting the cargo and will be responsible if there is an incident. %% The exporter, while applying for a marine insurance policy, has to give one or two sheets of information to the insurance company. To estimate the value for the insurance policy, the proposer needs to provide an invoice to the insurance company. The basis of valuation, which is the contents of the invoice, is {{cost, insurance and freight (CIF) plus incidentals up to a percentage which is agreed upon at the inception of the policy ( normally this is 10 %).}} Apart from the invoice, standard questions related to the exporter’s turnover, the value of the export, the carrier transporting the shipment, the security measures taken, his insurance claim history are asked. On assessment of the risk, the insurance company deems it fit to issue the policy and the type of policy to the exporter.

{{While Seeking Claims :}}$$ In case of loss of the merchandise, the following steps have to be taken: {[Take the immediate steps to minimise loss.]} {[Inform the insurance company or the claim-settling agent mentioned in the policy. ]} {[In case of damage to goods whilst on ship or in port, arrange for joint ship survey or port survey. ]} {[Lodge monetary claim with carrier within the stipulated time (proof of protection of recovery right). ]} {[Submit the duly assigned insurance policy or certificate along with the original invoice and other documents required to substantiate the claim such as {[Bill of Lading/ Air waybill (AWB)/ declaration with details despatched with GR no. given to the insured ]} {[Packing list]} {[Copies of correspondence exchanged with carriers. ]} {[Copy of notice served on carriers along with acknowledgement or receipt. ]} {[Shortage or damage certificate issued by carrier as whether the goods were lost, damaged or non-delivered. ]} {[Survey report, which is the investigation report on how the loss could have occurred.]} ]} Once the insured fulfils the above mentioned requirements, the insurance company steps in, pays the claim, and proceeds against the entity that has caused the loss to enable the insurance provider to recover as much.

{{Pre-cautionary Duties:}}$$ There are two reasons where one normally is stuck with documentation and the case of getting claims drags for a long period. It is the lack of awareness and responsibility about being insured. People need to understand what insurance is all about. It is not just about premium and claiming from policies. They need to know what are the duties cast on them if there is an incident. In addition, they need to act in a prudent manner while choosing their carrier, ensuring security, declaring correct value and paying more freight. %% While applying for marine cargo policy, the exporter should insist from the insurance underwriter details about what and how much of the cargo will be covered and what exactly has to be done at the time of a claim. On clearing one’s doubts about the insurance policy, the exporter should finalise the premium. As a rule, insurance companies provide a {{red slip}} containing the dos and don’ts in marine cargo insurance attached to the policy documents. %% On discovering that the insured has untruthfully declared his claims history, the insurance company could terminate the insurance policy because of bad faith. In addition, declaring the correct value of the goods to the carrier would help. The courier would charge a nominal amount for the packet at the time of sending. However, if the merchandise were lost, then the courier would give what is his per packet liability of Rs. 50. In addition, the insured would be stuck with the insurance company and the claim could drag on for years to the detriment of the exporter.%% If the proper documentation is done, it does not take much time to get back the claim. Besides, the insurance company provides guidance on finer issues like sending through particular logistic or courier companies, etc. %% {{Time to Sit Up & Be Cautious :}}$$ While 95 per cent of the jewellery industry in India uses the armoured vehicle services, there are times when the jeweller puts the packet containing valuables in his pocket and walks or travels in a cab or train to either the logistics office or the airport. Experts believe that as the Indian economy improves, there is a probability of organised robbery of valuables to creep in and making the man with valuables worth crores in his pocket an easy target. %% {{Risk Increasing :}}$$ However, things do not stop there. As looting jewellery and mugging people for valuables begins to rise, a vicious cycle starts with the exporter losing his valuables to his customer never receiving his order. This in the process would affect businesses. It is high time when people sit up and think of new business strategies to create a safe system that would last for at least a hundred years.

|*Transporting the merchandise safely to its destination is entrusted to various logistics service providers. However, how secure are their transport facilities and what happens when a loss in transit occurs? How fast and easy is the process to get back the claim? What is the Indian jeweller’s perception of risk? {{Diamond World}} endeavoured to find out...*|

{{THE INDIAN LOGISTICS INDUSTRY :}}%% First, it is vital to know about the precious goods logistic industry in India. While logistic companies specialising in valuables in the west are nearly more than a century old, in India the first logistic company started in 1981. {{Brinks Inc.}} a US based company, entered India through a joint venture in July 1981 to form the {{Brinks Arya India Private Limited,}} headed by {{Krishna B Kotak. Lemuir Express}} later on followed them in 1983. At that time, the logistic services were mainly offered to the diamond industry. In addition, a few traditional jewellers exported their merchandise once or twice a year. $$ Today, the major players in the gems and jewellery logistics business are {{JK Malca-Amit , Brinks Arya, B V Chinai (also known as BVC)and Lemuir Express.}} All the four logistics providers are located in the same premises where the Mumbai Customs Airport Commissionerate is located on Lamington Road. The player with the major chunk of this business is JK Malca-Amit with an estimated 42 per cent share. While Brinks Arya has an approximate 28 per cent and BVC holds 22 per cent of the market share, the rest of the market is dominated by Lemuir and other players. Around 95 per cent of the gems and jewellery exporters avail of the services provided by these logistic houses. Charges for armoured vehicle, airlines, service tax, and strong room prevail besides the customs paper work. Nonetheless there is stiff competition related to the services and discounts in charges offered, thereby benefiting the jeweller.%% {{SECURITY DURING TRANSIT :}}$$ For an industry that is high in both value and risk, it is but natural that security during transportation is of immense importance. Armoured vehicles with {{Global Position Systems}} (GPS), business information tracking systems and a minimum of two armed gunmen are the measures taken to safeguard the valuables during transit.

{{Armoured Vehicles :}}$$ Vehicles for transporting valuables comprise cash vans and bulletproof vehicles. In India, Brinks Arya leads with 350 vehicles out of which an approximate 80 to 90 vans are bulletproof. Following them is BVC with 35 armoured vehicles. JK Malca-Amit and Lemuir statistics were not available. $$ Globally armoured vehicles for valuables are graded on a scale of one to five – five being the highest. The vehicles are made according to the stringent norms set by international standards and the logistics company’s insurance provider. Bulletproof glass, stronger metal, GPS system, etc are some of the features found in armoured vehicles. Says {{Udai Chinai, Chairman & Managing Director, BVC,}} |*“There are instances where one puts grill on a simple cargo van and calls it a cash van! However, for valuables, that is not allowed. There are certain criteria for making armoured vehicles like at least thick bulletproof glass, high quality meta|. Unless the criteria are fulfilled, insurance companies refuse to insure the vehicle.” *| BVC, among its armoured vehicles, has two customised vehicles with high security systems and costing Rs.10 lakh each .%% Possessing the highest number of armoured vehicles in India, Brinks Arya ensures its vehicles are in running condition at all times. {{Dinesh Shah, advisor for diamond jewellery, Brinks Arya}} says, |*“The quality of the cash vans is upto the mark. The security department from Brinks Inc designs the vehicles and decides on the material used. Daily we examine the vehicles. If some fault is discovered in the vehicle, it is sent to the garage with immediate effect.” *|%% Nonetheless, as the rate of looting valuables in the country is lesser as compared to certain other countries, there is a huge difference in the built and glass thickness used in Indian vehicles. Says {{Udai Chinai,}} |*“As the crime rate for robbery of valuables in certain countries are high, the standards set for the armoured vehicle would be high. Weighing a minimum of one tonne the van would have bulletproof glass measuring one inch thick and the door supporting that glass would be around 800 kilos.”*| He further adds, |*“In India, as the crime rate is not high regarding looting, most armoured vehicles consist of bulletproof glass of 2, 3 or even 5mm and doors weighing around 20 to 30 kilos.” *|%% As compared to other countries where a charge is put for using armoured vehicles, in India the service is either complimentary with the other services it provides such as customs clearance, forwarding, etc. or offered at a discounted rate.

{{Gunmen & Ammunition :}}$$ The personnel transporting the merchandise back and forth in the armoured vehicle comprise the driver, navigator and gunmen. Albeit not being a hard and fast rule, a minimum of two armed gunmen is recommended. The gunmen are normally ex-army men who are recruited only after police verification and registered with the concerned local authorities. For the ammunition, which includes licensed rifles and bullets, there is a constant check to replenish any shortage of stock. While some of the companies hire third party security force and ammunition, Dinesh Shah quotes, |*“Brinks Arya does not depend on any third party security force for protecting its armoured vehicles. All the gunmen are part of the Brinks Arya payroll and the license for ammunition is in Brinks Arya’s name.”*|%% {{IN CASE OF LOSS :}}%% {{Under The Global Insurance Umbrella :}}$$ Though loss in transit is a rare case in the thirty years of the Indian precious merchandise logistics industry history, each of the four companies are tied up with international security service providers and are covered under Global Insurance. While BVC are now associates of Group 4 Security International (G4S) and are covered under G4S $200 million global insurance cover, Brinks Arya pays up to $50 million on loss of cargo. Most of the time, the logistic companies settle the claims with their clients in 24 hours or within four days, depending on each incident. The companies later on work it out on getting the money back with their insurance companies. $$ On an average with minimal paperwork, which comprises a claim loss receipt (a document that states the details about how the loss occurred) from the airline, the logistic companies receive their money back within a month. %% {{Other Insurance Policies :}}$$ Sometimes due to the customer’s insistence and the low value of the merchandize to be sent, the shipment could be sent via players like FedEx, DHL, etc. In such a situation, the customer is responsible for the risk of his cargo and has to apply for marine cargo insurance.

{{TAKING & CLAIMING MARINE CARGO INSURANCE :}}$$ Marine cargo insurance covers physical damage to, or loss of all types of goods while in transit by road, rail, sea and air. In India there are around 21 companies issuing marine cargo insurance. The gems and jewellery segment is considered high risk due to its value and size. If a packet were lost, then one would be looking at values of few millions. The insurance industry does reckon caution while issuing marine cargo policy to the jewellery industry. Not everyone in the industry is allowed to underwrite a marine cargo policy for the jewellery industry. Most of the insurance companies provide the insurance directly to the gems and jewellery fraternity and not to the logistics providers. %% {{Applying for Insurance :}}$$ According to a highly reliable source (who did not want to be named) while there is no specific policy for jewellery industry, the exporter needs to declare the value of the goods and what they are carrying to the carrier. This is in order for the carrier (be it courier or logistic company) takes extra care while transporting the cargo and will be responsible if there is an incident. %% The exporter, while applying for a marine insurance policy, has to give one or two sheets of information to the insurance company. To estimate the value for the insurance policy, the proposer needs to provide an invoice to the insurance company. The basis of valuation, which is the contents of the invoice, is {{cost, insurance and freight (CIF) plus incidentals up to a percentage which is agreed upon at the inception of the policy ( normally this is 10 %).}} Apart from the invoice, standard questions related to the exporter’s turnover, the value of the export, the carrier transporting the shipment, the security measures taken, his insurance claim history are asked. On assessment of the risk, the insurance company deems it fit to issue the policy and the type of policy to the exporter.

{{While Seeking Claims :}}$$ In case of loss of the merchandise, the following steps have to be taken: {[Take the immediate steps to minimise loss.]} {[Inform the insurance company or the claim-settling agent mentioned in the policy. ]} {[In case of damage to goods whilst on ship or in port, arrange for joint ship survey or port survey. ]} {[Lodge monetary claim with carrier within the stipulated time (proof of protection of recovery right). ]} {[Submit the duly assigned insurance policy or certificate along with the original invoice and other documents required to substantiate the claim such as {[Bill of Lading/ Air waybill (AWB)/ declaration with details despatched with GR no. given to the insured ]} {[Packing list]} {[Copies of correspondence exchanged with carriers. ]} {[Copy of notice served on carriers along with acknowledgement or receipt. ]} {[Shortage or damage certificate issued by carrier as whether the goods were lost, damaged or non-delivered. ]} {[Survey report, which is the investigation report on how the loss could have occurred.]} ]} Once the insured fulfils the above mentioned requirements, the insurance company steps in, pays the claim, and proceeds against the entity that has caused the loss to enable the insurance provider to recover as much.

{{Pre-cautionary Duties:}}$$ There are two reasons where one normally is stuck with documentation and the case of getting claims drags for a long period. It is the lack of awareness and responsibility about being insured. People need to understand what insurance is all about. It is not just about premium and claiming from policies. They need to know what are the duties cast on them if there is an incident. In addition, they need to act in a prudent manner while choosing their carrier, ensuring security, declaring correct value and paying more freight. %% While applying for marine cargo policy, the exporter should insist from the insurance underwriter details about what and how much of the cargo will be covered and what exactly has to be done at the time of a claim. On clearing one’s doubts about the insurance policy, the exporter should finalise the premium. As a rule, insurance companies provide a {{red slip}} containing the dos and don’ts in marine cargo insurance attached to the policy documents. %% On discovering that the insured has untruthfully declared his claims history, the insurance company could terminate the insurance policy because of bad faith. In addition, declaring the correct value of the goods to the carrier would help. The courier would charge a nominal amount for the packet at the time of sending. However, if the merchandise were lost, then the courier would give what is his per packet liability of Rs. 50. In addition, the insured would be stuck with the insurance company and the claim could drag on for years to the detriment of the exporter.%% If the proper documentation is done, it does not take much time to get back the claim. Besides, the insurance company provides guidance on finer issues like sending through particular logistic or courier companies, etc. %% {{Time to Sit Up & Be Cautious :}}$$ While 95 per cent of the jewellery industry in India uses the armoured vehicle services, there are times when the jeweller puts the packet containing valuables in his pocket and walks or travels in a cab or train to either the logistics office or the airport. Experts believe that as the Indian economy improves, there is a probability of organised robbery of valuables to creep in and making the man with valuables worth crores in his pocket an easy target. %% {{Risk Increasing :}}$$ However, things do not stop there. As looting jewellery and mugging people for valuables begins to rise, a vicious cycle starts with the exporter losing his valuables to his customer never receiving his order. This in the process would affect businesses. It is high time when people sit up and think of new business strategies to create a safe system that would last for at least a hundred years.