What is the difference

Annual vs Per-Shipment Cargo Insurance

Another important cargo insurance coverage distinction is between ‘per-shipment’ and ‘annual’ coverage. If you make multiple shipments per year, you may benefit from an annual insurance policy . The main differences between these options are:

Per-shipment cargo insurance

Multiple Shipment Cover

Annual Cargo Insurance

An annual policy can work out cheaper if you transport a large volume of freight in a year. Insuring each shipment individually could work out a lot more expensive and time-consuming if you transport a lot of goods throughout the year.

Through Flycovr you have the option of an annual cargo insurance policy with All-Risk coverage and all the benefits, for a frequent shipper of goods, which that policy brings.

Factors that will affect your annual cover include:

• The type of goods you are shipping
• The value of the cargo
• The method of transportation eg: via air, sea, land
• Are the shipments always the same value throughout the year?
• Where are the shipments going to/coming from?

Need a one or two-month option?

There is also a solution for freight forwarders and shippers who require a monthly or short-term cover option. Especially suited to clients who make 10+ shipments per month, you can get A-rated, all-risk coverage, up to $10 million for domestic and international shipments.

Get in touch for more information and we’ll be happy to help you find the best policy to match your unique needs.

Is Cargo Insurance Coverage Necessary?

It’s easy to think that having carrier liability insurance is all the protection you need. Shockingly, according to Loadsure, an estimated 60-90% of cargo being transported today is underinsured! 

What does this mean?

It could mean several things – none of them good!

Loss of money

If you are shipping valuable goods and they are not covered adequately, you will find yourself at a financial loss when you attempt to make an insurance claim.

Loss of reputation

If your cargo is damaged or lost in transit, your business reputation can be severely damaged. Having the correct cargo insurance coverage can help you recover the loss financially and therefore have the funds to resolve the issue more quickly, thus repairing your reputation with your customers.

Legal action

To make matters worse, you may find yourself facing legal action if you fail to deliver valuable or crucial goods when and where they are needed. Having cargo insurance not only protects you financially in a worst-case scenario, it also indicates that your business is prepared. Many things are outside of our control when shipping goods, but thinking ahead and being fully insured goes a long way if things do go awry.

Underinsured

Why Are Many Businesses Underinsured?

There are several reasons why so much cargo is inadequately covered. The main reason is that many insurance companies make cargo insurance unnecessarily complicated. 

Some businesses don’t have adequate cargo insurance coverage due to:

01/

Expensive premiums

02/

Think they are covered already

03/

Complicated claims process

Costs:

With some insurance companies, it can seem like it is so expensive to take out cargo insurance that it’s not worth the expense. Unfortunately, the ‘hope for the best’ approach can have a devastating effect on your business – you also need to ‘plan for the worst’.

Mistaken belief that you are covered already:

If you think that standard insurance has adequately covered your cargo you may be in for a rude awakening if your cargo is lost or damaged. Oftentimes the particular mishaps that befall your shipment are not covered at all by the insurance you have – this can be quite a shock when you try to make a claim.

Complicated claims process

The perception that making a claim is a difficult and lengthy process can be another barrier to a business taking out insurance in the first place. This can of course be a costly mistake if your cargo is lost or damaged in transit.

Customers are therefore either put off by the seeming expense and complexity of cargo insurance coverage and/or making a claim, or a business does take out insurance only to realise, too late, that they are not fully covered when disaster strikes. 

There has to be a better way – and there is:

Cargo Insurance Coverage in the Global Aviation Supply Chain

The aviation supply chain is very underinsured, with an estimated 60% of US aircraft freight alone being underinsured.

Estimated 60% of US aircraft freight alone being underinsured.

We’ve already covered some of the main reasons for this shocking statistic; aviation insurance can seem complex and expensive and there is a lack of knowledge in the supply chain which makes freight insurance in particular inaccessible.

The importance of moving shipments around the globe securely cannot be overstated. The aviation supply chain is heavily reliant on aftermarket service providers who make, supply, repair and trade aircraft parts.

Particularly specific to this industry are aircraft parts which are valuable, parts which may have a low financial value but are nonetheless critical, and of course time sensitivity – delay often means more expense!

When you factor in these crucial elements, not being adequately insured makes no sense. Cargo insurance coverage helps to eliminate or reduce financial and reputation risk.

If you could get all-risk shipment coverage in a matter of seconds, recovered to the value of the invoice, and at a fraction of the cost.

Why wouldn’t you? It’s really a no-brainer!

Detail of the cover

What Isn’t Covered by Cargo Insurance?

Some things are not typically covered by cargo insurance, such as:

• Damage or loss due to inadequate packaging
• Infestation or spoilage 
• Deliberate damage by the insurer
• Pre-existing, flawed goods
• Vice/criminality/illegal goods
• Loss of value due to the market itself
• Leakage, wear and tear, loss of volume or weight

In addition, we have a list of excluded goods (this is a non-exhaustive list):

• Commodities, such as soybeans, fruit, cereals, rice, oil, gas, precious metals, iron ore
• Bulk liquids
• Live animals or plants
• Luxury goods including furs, jewellery, perfume, art, antiques, tobacco
• Technology goods such as digital cameras, memory chips, photo sticks, mobile phones, etc
• Cash
• Bullion
• Credit and debit cards
• Hazardous materials including firearms, explosive materials, fuel
• Biological materials used in live science or medical, such as blood
• Narcotics and other pharmaceuticals 

See the complete list of exclusions here

After following our comprehensive prompts, adding in all the information needed, you can review your claim fully before hitting the submit button.

It’s as easy as that!

Do I need more cover?

If I Have Carrier Liability Insurance, Do I Need Cargo Insurance Coverage?

Carrier liability insurance is a basic type of insurance which offers some protection but has severe limitations. There is an important distinction too between carrier insurance and cargo insurance.

Carrier liability insurance

Protects the carrier from claims made against it due to negligence. It also covers any fraudulent claims made against damaged or missing goods. The carrier’s liability and compensation are usually limited by the weight of the cargo (not good if your cargo is important or valuable but lightweight). Typically, the shipper has to provide evidence that the carrier is responsible for the damage or loss of the cargo.

Cargo insurance

is intended to insure against goods from being damaged, lost or stolen while in transit. It is designed to reimburse the insured party for the full value of the lost, damaged or stolen goods. You only have to show that the loss or damage happened while being transported.

One-Click global door-to-door insurance

Pay-as-you-go insurance for any shipments up to $2 million

Underwritten to the true value of the cargo, not weight

All-Risk, domestic and international coverage in seconds

Cover even for typically hard-to-insure events

A-rated insurance underwritten by Lloyds of London

Cost-effective pricing through real-time data, often as low as 0.01% of the cargo value

Easily renew or recoup premiums

Accelerated settlements through our claims portal

When you factor all this in, and consider the alternative, it’s an easy decision. We offer the smart cargo insurance coverage that you want and need. Contact us and our friendly team will be happy to help get you started.