Discover How Cargo Insurance Can Prevent Headaches and Costly Fees
When it comes down to importing or exporting goods, regardless if you are using air, ocean, or ground freight forwarding services, you may consider investing in cargo insurance. Legally, carriers must provide a standard amount of insurance coverage, known as carrier liability. Many companies question whether the choice for cargo insurance is truly worth it but here at Promptus, we always recommend all importers or exporters purchase some form of insurance to protect their cargo.
This is because carrier liability only offers limited coverage – typically the bare minimum. In the event of an emergency or accident, you may find yourself shelling out funds to cover lost goods, even if you aren’t at fault.
What To Understand About Cargo Insurance
One of the biggest mistakes made in shipping cargo is assuming the other party took the steps to insure the shipment. Unfortunately, in most cases, this results in no coverage being requested and in the event of a mishap, someone will have to pay hefty costs.
It is vital to know who will be requesting additional insurance coverage on your goods. If it is the shipper or the manufacturer, be sure to confirm their insurance arrangement prior to committing to the contract. With some foreign exporters, they may be using an insurance company from their own country, which means following their rules. Be aware of all the options before moving forward, and remember that having a US-based insurance company could go a long way if it comes down to filing claims thanks to US insurance laws. Thankfully, various options can be explored.
Take Care of Your Merchandise
Insurance is beneficial for a number of different reasons. Obviously, the reason for a coverage plan is to protect your assets in the event that your goods or the carrier are lost, destroyed, or damaged. This can end up protecting parties on various ends, in many cases.
For example, if you are a shipper who has shipped but hasn’t received funds or a buyer who has paid but hasn’t yet received the goods and an unexpected tornado or natural disaster strikes, causing unavoidable destruction to the entire carrier’s cargo load. By the traditional liability coverage, the carrier would not be required to pay out, nor would the shipper. This leaves both parties inadvertently in trouble. However, if one (or both) of the parties had a more full-coverage insurance policy in place for this shipment, their insurance would kick in and provide them with a payout to help cover any losses. Sounds great, right?
It is! Assuming you have the right coverage. That’s another important factor to consider: purchasing the right insurance plan for your business’ needs. Whether you require an all-risk policy or a named perils policy will depend on if you want to guarantee costs for the widest range of possible losses or if you only wish to protect against certain type of loss.
- An all-risk policy will cover everything, except anything specifically excluded in the contract or policy. This type of insurance is typically more expensive, but offers more comprehensive coverage options.
- A named peril policy will only cover what is specifically included in the policy. This means if something perilous happens, such as a vandalism or robbery, but you only have natural disaster protection, you will not be covered.
Expert Logistics Services in Miramar, FL
At Promptus LLC, our freight forwarding services are fully insured and offer clients various levels of coverage to suit their particular needs. When you go through a 3PL or third-party logistics team, you gain access to our extensive array of resources, including insurance options. As a large company, we get better deals on insurance prices to cover all of our air, ground, and ocean shipping options. This means cheaper rates for our customers as well! Contact us today to get a quote on all your global logistics needs.