Understanding the Value of Cargo Insurance
Any customer shipping their goods faces some risk. But, cargo insurance reduces potential loss from that risk dramatically by providing cargo insurance that covers your goods throughout the supply chain. Essentially, cargo insurance puts control over the value of goods in the hands of the customer and not the transportation providers.
Whether you’re moving cargo with Crowley or with any other transportation provider, this insurance provides peace of mind for the customer. You can be assured that if a malfunction or calamity occurs during the shipping process, the value of your goods will be covered.
In the event of a loss without cargo insurance, customers would be forced to rely solely on a very limited carrier liability policy. Rather than simply counting on the carrier to cover some of the value of the cargo if it is damaged under certain circumstances, cargo insurance proactively places protection of goods against loss in the hands of the customer – in some cases without a deductible.
Each carrier is required to carry limited liability coverage, but there are many scenarios where that liability coverage won’t cover damaged cargo – in part or in full. Carrier liability coverage often only covers about $500 per shipping container, not per customer even if one container contains consolidated goods from several shippers. Even more challenging is that carrier liability coverage is for cargo during ocean transport only and doesn’t apply to cargo in warehouses or being transported over land, exposing customers to the potential of huge losses by relying on liability coverage by the carrier.
Consider a customer sending a cargo load worth about $150,000 in one shipping container; the carrier’s liability is only going to cover about $500 of that value if no additional cargo insurance is purchased. Straining the shipper’s liability risk even more is that many “acts of God” – also known as Force Majeure events – are excluded as natural and unavoidable catastrophes from coverage.
An investment in cargo insurance at a fraction of the total value of the goods being shipped is the ultimate value.
The “All Risk” policies are the most secure way to insure your cargo. All Risk” insurance and it’s the broadest form of coverage available in the marketplace for shippers. It is a specialized insurance coverage designed to protect goods against all risks of physical loss or damage from any external cause during international and domestic transit. Coverage applies to all modes of transit throughout the supply chain on a global basis, and in the case of Whitehall’s “All Risk” Cargo Insurance product, carries a zero deductible for approved, general merchandise. Whether a shipper ultimately decides to purchase All Risk insurance or another type of policy that meets their needs, the importance of protecting cargo along the supply chain can’t be underscored enough. To review a list of Frequently Asked Questions about this type of insurance, click here.
If you don’t currently have an experienced cargo insurance agent to guide you through the process, we invite you to contact the experts at Whitehall Insurance via email at firstname.lastname@example.org or by calling (888) 470-4997.