7 things that can go very bad if you don’t have load insurance

Transporting goods from one location to another can always be subject to different kinds of risk.

Damage and/or complete loss of cargo is always a possibility in shipping. Load insurance offers a way to protect cargo from many possible accidents. While every shipper has to offer minimal insurance required by law, there are several incidents that are not covered by it. That is why many companies opt for additional insurance. Listed below are 7 types of incidents that can be prevented with load insurance.

CARGO THEFT

A great amount of cargo gets stolen every year, and the number is rising. Identity theft and fake pickups are some of the most common ways cargo gets stolen. Also, especially when it comes to international shipping, piracy can present a great problem. Opting for anti-theft load insurance makes sure that cargo is protected even in the event of a client’s goods being stolen.

SHIPPING CONTAINERS LOST AT SEA

Unfortunately, the number of containers lost at sea is rising every year. According to statistics, the average number of shipping containers lost in the 2011-2013 period has almost doubled compared to 2008-2010. One more reason shippers ought to get shipment insurance is the significant rise in shipping containers lost at sea.

CARGO DAMAGE

The most common incident that can happen during shipping is cargo damage. Cargo damage can be temperature related, physical, sinking, contamination, infestation, etc. Damage to cargo occurs quite frequently since there are so many different possibilities for damage to be caused.

GENERAL AVERAGE

General Average is an internationally recognized shipping practice in which all parties share the loss equally if certain kinds of incidents happen on the vessel. Even though your cargo may not be damaged, in the case of a General Average you may be required to post a bond in order to claim your cargo. If insured, the insurance company takes responsibility in these situations and speeds up the release of your cargo. 

LIMITED CARRIER LIABILITY

By law, carriers are not responsible for many of the most common causes of loss. In the event of a loss, even when carriers are accountable, their liability is limited – either by arrangement in the bill of lading or by law. Shippers should never rely on the carrier who ships their merchandise to cover any damage or loss that may arise during a container ships journey.

ACCIDENTS CAN HAPPEN

Many types of accidents can happen during a shipment. Shipwrecks, storms, and even pirate attacks can cause a great loss of valuable goods. Catastrophic events cause loss to shippers on a yearly basis, and insurance provides a way to keep loss to a minimum. 

BREAKING CONTRACT TERMS

Many sales contracts require the cargo to be insured by the shipper. Unfortunately, insurance sometimes gets overlooked. Reading the fine print, in this case, is crucial because in the event of an uninsured accident the shipper can be held responsible for the loss and for breaking contractual terms.