What Is Cargo Insurance?
Legally, all carriers must carry a minimum amount of insurance, known as carrier liability. However, carrier liability provides very limited coverage, and anything from natural disasters to vehicle accidents or even acts of war could damage your cargo. Therefore, shippers can request cargo insurance to protect their goods from loss, damage, or theft while in transit. Generally, goods are insured while being stored and while in transit, until they reach the buyer.
We understand that protecting goods from the point of departure to point of delivery is a necessity. Cargo Drop Logistics will help navigate a clear route for your transportation or other logistic insurance needs, so you can stay focused on your business.
Benefits of Cargo Insurance
Cargo Drop Logistics Insurance covers transits carried out in water, air, road, rail, registered post parcel and courier. Following aspects are covered under the benefits of this insurance:
All Risk Coverage
This coverage provides extensive protection against damage or loss due to external factors. Though, this is called all risk coverage but still, people should know the aspects included and excluded in the policy. Under all risk coverage, included aspects are:
- Damages due to inappropriate packing
- Cargo abandonment
- Customs rejection
- Employee’s dishonesty
Free From Particular Average Coverage (maritime insurance related)
“Free of particular average” coverage clause excludes coverage partial losses to the cargo or to the hull except those resulting from stranding, sinking, burning, or collision. Another important aspect of this clause is that the shipper does not pay for minor losses (pre-decided percentage) and is only held liable in case of significant losses to the cargo. This insurance coverage belongs to special category and covers particular perils only. There is difference in coverage depending upon the storage location of the cargo. In this policy, following perils are included:-
- Heavy weather
General Average Coverage
This coverage is basic requirement in the marine cargo transits. More specifically, it covers only partial loss occurred to the shipment. It requires all the other cargo holding owners on the ship to pay compensation to the periled cargo owner.
Warehouse to Warehouse Coverage
This coverage is applicable when shipment is unloaded from the ship and it gets transported to the customer’s warehouse. Insurance companies are very particular about compensating only the insurance holder’s cargo, not other owners’ cargos.