Freight Insurance – Prevention is better than cure

Why you not avoid potential financial losses by insuring your goods? Insurance acts as a cover that is placed on your goods and protects them. After reading this, we hope that when you ship products, you understand its significance. Otherwise, consider the implications of no freight insurance and the losses will be borne by your business.

Cargo insurance mainly covers compensation for loss and relevant charges of the freight goods caused by natural disasters and accidents in freight forwarding. Always be aware of your shipping insurance process.

 

Liability insurance or cargo insurance?

What are the different types of cargo insurance?

How does Topshipping help you with freight insurance?

Are you using the freight insurance tips?

 

Why do you need freight insurance?

You have to consider many things in your freight forwarding process, such as the volume of goods, destination, time, etc. You can also protect the product in some way by packaging. In addition to these issues, there is a general rule in this industry: if you not using cargo insurance, you’re doing it wrong. In the case of international freight forwarding, due to long distances, there may be surprises on the ship or aircraft. So there is no reason not to insure your goods.

Be careful not to confuse liability insurance with cargo insurance. These are two type of freight insurance. The first one is very limited and the latter covers a more comprehensive level. Sometimes it even includes the cost of delivery delays.

Cargo Insurance

It is a third party insurance that covers the freight cargoes. In case of any problem or damage to the goods, it will bear the cost of your damage. This type of insurance includes different policies and each covers different type of damage, materials and claims.

No policy follows a specific law and is not based on a standard. It try to deprive the carrier of benefits of insurance by playing with words. for example the goods were not properly stored before freight forwarding or if so, there is no evidence and the claim is invalid. Therefore, effort and research is a necessity for choosing the most appropriate insurance.

Here we provide some types of sea freight and air freight cargo insurance.

Single coverage

It covers each product individually. As a result, it may not be suitable for large shipment involving multiple containers. because it’s not cost effective. But on the contrary, it is very suitable for rare and special goods.

Open coverage

This insurance covers all your shipments for a period of time, like one year.

All risk cover

This type of freight insurance is suitable for both air freight and sea freight and is the best option to protect your goods. As the name implies, it covers a very wide range of damages and problems, but has its own exceptions, such as:

  • Negligence of the importer or exporter
  • Customs rejection or delay
  • Damages caused by strikes, internal unrest, war…
  • Damage or loss as a result of acts of God such as earthquake

Named perils cover

It covers only the risks mentioned in the cargo insurance policy such as:

  • Cargo theft
  • Acts of God
  • Bad weather
  • Non – delivery of the cargo

General average and its significance

This freight insurance is for ocean goods. According to this, If ocean problems damage your goods, all the other cargo owners of that vessel will pay for your cost of compensation. So even if your product is not damaged, you can help pay for other goods.

Based on this information, you will find that insurance policies with different coverage levels are available. You need to decide which type is right for your business.

How do I choose the right freight insurance policy?

Insurance and its parameters have certain complexities. To choose the best option, leave your cargo insurance process to a professional. Let Someone who is proficient in insurance and laws, do it for you. This process requires experience and a freight forwarder company like us can help you a lot.

Topshipping works with knowledgeable insurance agents to get your freight insurance process right. Here, we choose the most suitable insurance based on your needs and type of goods. Most importantly, we insist on your use of freight insurance, because anything can happen in air and ocean freight, which causes significant financial losses.

Some freight insurance tips at a glance

Having an insurance policy is not required at all and is not automatically added to the bill of lading. Shipping companies only insure the goods upon your request. So before you do anything, apply for your insurance policy.

If your goods are damaged and you want to claim compensation, the mistake must be proven. This compensation depends on the value of coverage at hand.

Make sure you buy the freight insurance that suits your needs and work with professionals, to have efficient insurance process. The key to a cost-effective and hassle-free process is to maintain quality from start to finish.

Use proper incoterms during your freight forwarding process. Because each of them determines that during this process, the supplier or buyer is responsible for the risks.

File your claim

Make sure you have supporting documentation for any claim you file. In order to file at USPS, you will need a completed claim form, evidence of insurance, evidence of value, and proof of damage or loss of contents. Some instances require a repair estimate as well. If something can be repaired, the carrier won’t give you the full amount of the item.

 

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