Insurance Scam By Vehicle Exporters

[kush]

I thought of writing this to inform any prospective person who is considering a personal vehicle import of the potential risk involved.

I personally imported a car last month, it was arranged by a local agent who got me the vehicle through a Japanese auction and I was issued a Performa invoice through a Japaneese company owned by a Sri Lankan.

Price was quoted as CIF (Cost + Insurance + Freight) which is usually the case and LC (Letter of Credit) was established. When the documents came to the Bank I was informed that the insurance certificate was not there and they asked me whether I would like to accept documents without it.

Since the vehicle is already on the way not wanting any delays I accepted the documents thinking that they have forgotten to forward the certificate.

After a couple of weeks similar incident happened to another colleague which raised suspicion and when inquiries were made from the shipper they were giving various excuses. Even the bank officials were saying it is the case in most of the instances.

Implications of this are

If something happen to the ship on the way or the vehicle get damaged on transit importer (you) will have the bear the loss.

Shipper will get a way as the only option for you will be to sue him for damages not taking insurance as quoted in the Performa, which will basically be very costly and impractical.

The bank will get a way as you have accepted a discrepancy discharging of their liability.

You will have several options

1. Get the Performa C & F (Cost + Freight) and do the insurance locally before shipping
2. Do not accept the discrepancy and let the Bank go back and forth without retiring the bill till the ship comes in so at lest you will now that there will not be a total loss and then accept it and retire.

Of course there will be a cost, bank charges etc.

Good luck

[Crishan]

I thought of writing this to inform any prospective person who is considering a personal vehicle import of the potential risk involved.

I personally imported a car last month, it was arranged by a local agent who got me the vehicle through a Japanese auction and I was issued a Performa invoice through a Japaneese company owned by a Sri Lankan.

Price was quoted as CIF (Cost + Insurance + Freight) which is usually the case and LC (Letter of Credit) was established. When the documents came to the Bank I was informed that the insurance certificate was not there and they asked me whether I would like to accept documents without it.

Since the vehicle is already on the way not wanting any delays I accepted the documents thinking that they have forgotten to forward the certificate.

After a couple of weeks similar incident happened to another colleague which raised suspicion and when inquiries were made from the shipper they were giving various excuses. Even the bank officials were saying it is the case in most of the instances.

Implications of this are

If something happen to the ship on the way or the vehicle get damaged on transit importer (you) will have the bear the loss.

Shipper will get a way as the only option for you will be to sue him for damages not taking insurance as quoted in the Performa, which will basically be very costly and impractical.

The bank will get a way as you have accepted a discrepancy discharging of their liability.

You will have several options

1. Get the Performa C & F (Cost + Freight) and do the insurance locally before shipping
2. Do not accept the discrepancy and let the Bank go back and forth without retiring the bill till the ship comes in so at lest you will now that there will not be a total loss and then accept it and retire.

Of course there will be a cost, bank charges etc.

Good luck

If these said exporters are so cheap to even cheat with the insurance, just imagine the quality of the vehicle you will receive.