Cargo Insurance: Protect Your Assets

Purchasing cargo insurance is especially important for small and medium-sized businesses, as they may not have the financial resources to absorb the loss of goods and carriers often limit their liability. It's also a good idea for businesses that are shipping high-value or specialized items, as these are more prone to loss and may not be covered under a standard insurance policy.

Another reason to consider cargo insurance is the increasing complexity of supply chains. Globalization has led to the growth of multi-modal transportation, with goods being shipped by sea, air, and land. This complexity increases the potential for risk of loss or damage to goods, making it even more important to have a comprehensive insurance policy in place.

Cargo Insurance: One Size May Not Fit All

It's important for businesses to carefully consider their insurance needs and choose a policy that meets their specific requirements.

There are a couple of major factors to consider here. First, there are two main types of cargo insurance: "all-risk" cargo insurance coverage and "named-peril" coverage. All-risk coverage provides broad protection against almost any loss or damage to the goods, regardless of the cause. Named-peril coverage, on the other hand, only covers specific risks that are listed in the policy.

Another factor to consider is the policy limits. It's important to choose a policy with limits that are sufficient to cover the value of the goods being shipped, otherwise you could end up on the hook for the difference. It's also a good idea to consider purchasing an "overlimit" endorsement, which provides additional cargo insurance coverage above the policy limits for extra peace of mind.

Finally, it's important to carefully review the policy exclusions and limitations. Some cargo insurance policies may exclude certain types of goods.

To find out more about insurance available through Flexport Insurance Solutions, please reach out to our team of licensed experts today.

Insurance is offered through Flexport Insurance Solutions, LLC ("FIS"), a licensed insurance producer (Illinois License No. 3001047128, California License No. 6001029). Insurance is not available in all countries. Check with a licensed FIS representative for availability. For term coverage, FIS acts as an insurance broker and seeks quotes from multiple insurance carriers with A.M. Best ratings of “A” or higher who actually underwrite and issue coverage. Per shipment coverage is underwritten and issued by Navigators Insurance Company.

The contents of this blog are made available for informational purposes only and should not be relied upon for any legal, business, or financial decisions. We do not guarantee, represent, or warrant the accuracy or reliability of any of the contents of this blog because they are based on Flexport’s current beliefs, expectations, and assumptions, about which there can be no assurance due to various anticipated and unanticipated events that may occur. This blog has been prepared to the best of Flexport’s knowledge and research; however, the information presented in this blog herein may not reflect the most current regulatory or industry developments. Neither Flexport nor its advisors or affiliates shall be liable for any losses that arise in any way due to the reliance on the contents contained in this blog.