Total Insured Value, or TIV, is the full declared value covered by an insurance policy for a shipment, property, or group of assets. In cargo insurance, it usually reflects the commercial value of the goods plus related costs such as freight, insurance, duties, and an additional percentage to cover expected profit or incidental expenses. TIV matters because it helps determine the insurance premium and the maximum amount that may be paid if the insured cargo is lost or damaged. TIV may apply to a single shipment, per vessel, or across an entire policy period, and it must be set at or above the full replacement value of the cargo to avoid underinsurance. Cover is only valid where the policyholder has an interest insured, meaning a real financial stake in the cargo that would be lost if it were damaged or destroyed.
- Per-shipment TIV: maximum coverage for a single voyage
- Per-vessel accumulation limit: maximum exposure if multiple shipments are on one vessel
- Annual policy TIV: total expected value of all shipments during the policy year
- TIV should include invoice value + freight + insurance premium + 10 percent profit margin
Related terms: All-Risk Coverage, Deductible.
