In light of the unfolding Hanjin bankruptcy saga, shippers are more concerned than ever about protecting themselves against potential risks to their goods along the supply chain. You may be asking: Is it worth it to get cargo insurance? What does cargo insurance protect me against?
Mishaps can happen
Let’s face it: Shipping your goods over long distances can be risky – and stressful. The unfortunate truth is that many shippers have suffered significant financial losses due to mishaps along the way. The loss of a single shipment or even a fully loaded ship is not unheard of and can spell disaster for those affected.
The financial fallout from natural catastrophes, manmade errors, dishonesty, or unintentional mistakes can reach into the hundreds of thousands or even millions of dollars.
Unfortunately, there is no way to prevent adverse events. You can, however, take steps to protect yourself from a substantial financial loss in case things do go awry. These include: ensuring that proper inventory is taken of items to be shipped, making sure your goods are well packed, and insuring your shipment with a solid cargo insurance policy.
What does cargo insurance do for me?
Cargo insurance protects your goods from physical loss or damage during transit. The main objective is to provide compensation should cargo fail to arrive safely at its destination. There are numerous types of cargo insurance policies and the cost and coverage vary. Policies can be applied to land, marine, or air shipments, or a combination of modes and can cover international or domestic shipping.
Different policies will insure for different things – make sure you understand what is and isn’t covered. Many policies, for example, do not cover losses due to delay. Regardless of the type of shipment or mode of transport, shippers should review cargo coverage needs with their insurance agent.
It’s up to you to consider your options and decide whether the cost of cargo insurance is justified. If you decide it is, shop around to find the best policy to suit your needs and budget. If you’re shipping unusual cargo, consider using an insurance firm that specializes in those goods or take out a single-shipment policy in consultation with your insurance agent.
Consult a provider with an extensive background and a good reputation who can help you understand all the variables. Make sure that the insurance agency you choose can protect your goods along its entire journey and over all modes of transportation.
For detailed information, contact your Logistics Coordinator. For more general information, contact us today to discuss the best way to ensure the safe shipment of your goods.
Information provided by: Supply Chain Consultant - Cole International