What Is Cargo Insurance
Legally, carriers should offer a minimum amount of insurance, which they call carrier liability. Therefore, you can somehow claim a certain percentage of your cargo’s worth from your freight forwarder in case of damage, loss or theft while your goods are in transit. Generally, the cargoes are insured while they are stored and while in transit until they reach the destination.
Unfortunately, not all realize the importance of insurance. This is, in fact, the most important part of freight forwarding and a critical element to have when you want to find an efficient supply carriage shipper that can ship your goods to and from Singapore. A reliable forwarding agent will include a cargo insurance to their package to give clients peace of mind while their cargo is in transit.
What Are the Limitations
As expected, insurances have limitation. For example, when your goods are shipped here in Singapore via truck, the carrier liability does not provide a protection against damages or losses caused by an independent motor carrier. That is why it helps a lot if your air freight, sea freight
There are various types of insurance policies for cargo shipments, some are labeled as ‘broad form,’ ‘allrisks,’ and ‘legal liability.’ Regardless of the name, none of these policies provide total protection. These policies provide coverage in different ways, such as only these certain types of goods are covered, losses caused by some events are not included or a coverage only applied if the service is performed in a particular way.
In general, it is important for any shipper to record the value of their cargo in case of losses, damages or any disputes. It is also critical to seek legal help and work with an insurance company here in Singapore to fully understand your rights and level of protection.
Types of Cargo Insurance
Insurance policies for cargo shipping can be taken for local and international freight. However, it can be challenging to control and standardize any insurance policy without the cooperation of the countries due to the variations of the insurance, which can be categorized into the following classifications:
- Marine Cargo Insurance
This covers the transportation of goods via sea freight. To dispatch goods delivery by ships, whether for import to or export from Singapore, they are covered with insurance in case of damage due to loading and unloading of cargo, piracy, weather contingencies and other issues. Most of these policies cover international freight, but many sea cargo insurances provide them with specific terms and agreements, which vary from provider to provider.
- Land Cargo Insurance
This insurance will protect your cargo from the damages incurred during the land transportation of goods. The insurance’s coverage aspects include collision damages, theft
Why Do You Need It
Your freight forwarding services will have to ship your goods in land, sea
- Damages Caused By Many Different Circumstances
The logistics for transportation of goods provides plenty of opportunities for your cargo to get damaged. Some of the common reasons for damage are:
- Poor packaging
- Wrong choice of container
- Poor distribution of cargo weight
- Lack of carriage instruction
- Wrong temperature
- Stack weight exceeded
- Contaminated floors
There are actually more things that can possibly go wrong and damage your goods. These are just a few to help you see why you need to get your cargo insured.
- Limited Coverage of Carrier Liability
Your freight forwarder only covers so much. Although Freight Master is a trusted name in Singapore for logistics services, it is still imperative to get your grounds covered in case of unforeseen circumstances. Since carrier liability is very limited, you want something that will reimburse the most value of your goods in the event of damage, loss or theft.
- Cargo Theft
Cargo theft, especially in the form of
- General Average
General Average is an accepted international regulation
Should I Request for a Cargo Insurance
Now that we have tackled what cargo insurance is, what it covers and why you should get it, hopefully, you have realized the monetary security it can offer to you. If not, think of the possible risks you may encounter in the shipping of your cargo via air freight, sea freight
Accidents happen; so, it would be best to ask your logistics company if they offer additional coverage for their insurance. If not, look for an insurance company that can offer you the best possible coverage.