Maintaining Proper Cargo Insurance and Inspection of Goods

Marine Cargo insurance is an integral part of transportation since anything can happen to goods while in transit. Goods could be damaged in a storm or fire, be stolen or simply be mishandled or lost from their origin in your warehouse to their final destination. Marine cargo, or Shipper’s Interest Cargo Insurance and inspection of all goods in transit are the smart solution to protect against a financial loss.

Professional inspection services are critical whenever the custody of goods transfers between buyers, sellers and traders. Inspection occurs during critical transportation, custody transfer and storage operations.

High value bulk commodities, which includes crude oil, chemicals, fuels, grains, and many other products are measured, analyzed and verified for shipment and inventory quantity and quality. Inspectors then survey and sample representative product from bulk storage tanks, tankers, cargo ships, barges, rail cars, shore storage and transfer facilities and warehouses in order to determine if the goods are being stored and facilitated properly.

What is an all risk cargo insurance policy?

All-Risk Cargo Insurance is perhaps the broadest form of coverage available. It provides first-party protection on approved general merchandise for loss or damage to cargo from external causes. An easy way to think of “All-Risk” Cargo Insurance is that everything is covered, except what’s excluded.

In order to compete in today’s transportation industry, freight brokers are being asked by their shippers, consignees, freight-forwarders and 3PL’s to guarantee payment on cargo claims. Unfortunately, motor truck cargo insurance will not cover freight loss or damage including Default Act of the Shipper, Act of God, or Act of Infidelity, to name a few general causes.

In addition to providing coverage for any loss or damage, marine cargo insurance also pays for the costs to minimize a loss and pays for damage inspection. Some shippers may believe they can rely on the carrier, but that is not always the case since most carriers have limited liability in regards to such matters and are provided legal defenses, which absolve them entirely of any financial responsibility. Cargo insurance pays covered claims without the need to prove fault.

Marine cargo insurance and inspection is the best line of defense for shippers that have obvious concerns where the transportation of goods is at stake, and any loss can have a dramatic affect on their bottom line.

Helpful Tips to Help Reduce Cargo Claims

As a shipper, you know that your customers often view their cargo as something precious, and wish to have it arrive to its destination intact, on time, and undamaged. But unfortunately, accidents happen and problems will occur once in a while. This is the point where a cargo claim needs to be filed due to damage, or perhaps something equally unfortunate, such as an inaccurate product count.

One good thing to realize cargo claims information is that they are filed on approximately less than 10% of all shipments, on average, depending on the type of product, method of packaging, and the length of haul.

Merchandise that is well-packaged, or sturdier products moving a short distance will have less of a chance of being lost or damaged when compared to those items that are more fragile, as well as exposed cargo that is moving across country.

About cargo clams and accident prevention

An experienced shipper has seen it all by now and knows of ways to minimize the risk of being involved in a cargo claim, on the part of both the shipper and the driver. It helps to be considerate of the freight by triple-checking the packaging. Insist on better packaging techniques, for example, using crating and foam for fragile or high-valued products.

How well is your cargo protected if it gets exposed to bad weather? Is the packaging strong enough to hold together for an extremely long journey? What are the odds that it will be loaded and offloaded more than once, and will it be picked up by hand or does it require equipment to move it from place to place?

The driver has many other concerns as well. He or she needs to feel comfortable with how the items being shipped are prepared. It can be helpful to check out both, the pickup and delivery areas for possible issues, such as ability to navigate the truck without too much effort, and will there be any problems getting the product to fit where it’s to be delivered?

Materials available to help get packages to their correct destination

Using brightly colored labels that have bold, legible writing will reduce the chance of erroneous deliveries. They also sell products, such as “no stacking” cones and sensors that change color in the event of excessive stress to a package. Shippers should also use address labels on each separate package to ensure the entire shipment ends up where it needs to go.

4 Important Steps to Take If Your Cargo Is Damaged

When you order a shipment of cargo, you have the right to receive it in full and undamaged condition. If you notice any damage, you may file a cargo claim. This quick guide to cargo claims information can help you take the correct steps after receiving a damaged shipment.

  1. Protect the Cargo
    Take immediate steps to protect the cargo from further loss. This may include moving, isolating, repacking or separating goods.
  2. Document the Details
    As soon as you see the first signs of damage, begin to document the details. Take digital photographs and videos. Make clear notes of all damaged areas.
  3. Notify Your Insurer Immediately
    Send all relevant cargo claims information to your insurer as soon as possible. In the case of ocean shipments, the receiver must report visible damage no later than three days after receipt of goods. For air shipments, the deadline is one week.
  4. Speak With a Surveyor
    It can be difficult to identify the full extent of damage with the naked eye. A professional surveyor can look over the shipment and report damages to the insurer. In many cases, companies lose part of their valuable reimbursement because they did not survey damages sufficiently.

Damaged cargo can be an inconvenience and a financial risk for businesses. Speak with an insurer today to learn more about cargo claims information.


photo credit: mystuart cc