What Is Freight And Cargo Insurance?
With technology advancing so quickly in the logistics world, there’s now more and more demand for products and materials to get to places faster and from greater distances away. We have become so accustomed to having things when we want them, that all the extra detail that goes into the actual shipment is forgotten.
Cargo and liability insurance is an insurance policy that will cover the transporter from the costs of these products should they get damaged or lost at any point from the start to the final destination, whether it is traveling by air, sea, or land.
Types Of Cargo Insurance Available
Motor Truck Cargo Insurance
Probably the most well-known type of cargo insurance is motor truck cargo coverage, which is the coverage for on-road truckers. Not only will this cover fire, weather-related, or crash damage to the product, if the product falls off the truck for any of these reasons, this can cover the costs of removal of debris on the road or water.
Marine Cargo Insurance
If your product is being shipped by sea, marine cargo insurance will be your main option. Compared to the road, there will definitely be a lot less potential for a crash. However, being on open water, you do not have the option to pull over to the side and assess a situation that can be potentially hazardous. This logistic coverage can cover loss, theft, or damage to the shipment while on the sea.
Air Cargo Insurance
While shipping product through the air, air cargo will be the insurance you would select. With this being the fastest travel option, it is possibly also the most heavily used type of delivery option for products, making the distance from point A to point B that much easier to get to. Though it is the easiest and seemingly safest way of travel, it comes with its own risks. Should the products be damaged or lost while in flight, you will be covered by the cost to replace these items.
How Much Does Cargo Insurance Cost?
There will be a very wide range of pricing for cargo insurance and many factors that will decide your final price. To start, the main factor will be determining how your shipment is traveling to its final location. After that, the biggest factors to take into account when figuring out the logistics insurance cost will be:
- Value of product
- Route location
- Weight and size of the product
- Whether the product is hazardous
- Volume of shipment
Do Not Wait, Cover Your Freight!
Insurance for a shipment is not mandatory for Michigan logistic companies, however, there are millions of dollars worth of products being shipped every day and the risk is far too great to leave that to chance. It can literally put your business in deep waters and you might not be able to recover if an accident or natural disaster strikes. Contact us here at Compass Insurance Agency and let us help decide which coverage is best for your cargo. Don’t put your products and yourself at risk and get covered with us before it is too late.