Cargo insurance before cargo transport
Many cargo transport companies use the best modes of transport to import or export cargo all over the world. They all look out for the best transport mode but what they do not consider is cargo insurance.
If you are a seller or buyer of a good and are at risk for the goods under an incoterm that places the risk and liability of the goods on you during the transportation. Whether you are receiving or shipping out cargos, every step of the way there may be unavoidable perils, hazards, or accidents. The shipping containers fall overboard from the vessel. Now, the goods are gone and maybe the buyer is not going to pay you. The carrier will only reimburse you according to their legal obligation and liability. At best you will receive limited recompense for the inventory that is lost [or damaged and this is the reason you should consider marine cargo risk insurance.
How does the cargo insurance help?
The cargo insurance not only helps the cargo transport company but also the carriers. It will cover the cost of lost or damaged goods if an overseen event occurs during transportation. Similarly, it will protect you from the financial harm of cargo theft or loss in transit. You should always consider purchasing cargo insurance if you are the party at risk under the
applicable incoterm. The policies can be flexible and can provide the following covers :
All risks transit coverage by air, sea, and land covers
- All risk of physical loss or damage to goods during the insured transit
- Risks of loading and unloading
All risks warehousing coverage
- Long term storage can also be insured on a risk basis
- From the time the goods were in the carriers
- At the seller's premises
- At the country of origin until the time the goods are delivered to the destination
How does a cargo transport company control cargo movement?
The journey of the cargo starts with the company that makes cargo that is the manufacturer. They need a way to move their products from where they are manufactured to where they are consumed. This is where the cargo transport companyis involved. This process is referred to as supply chain logistics and it can be complicated.
Ocean transport is slow, less expensive, and has a smaller environmental impact. It is often the best mode if you have a large amount of cargo that needs to be moved. On the other hand, the air is great if you need things fast, and the manufacturer needed to ship out more in a rush. Finally, ground transportation is good for the port to the warehouse or the final destination.