Take Control of Cargo Insurance

Control Cost and Cover

Damage to goods caused by clandestine migrants has recently highlighted the importance of cargo insurance; but even so, because it’s a class that can seem quite scary, if a client says they don’t need their own policy, many brokers just breathe a sigh of relief. Now is the time for clients to take control of cargo insurance.

Since taking control of cargo insurance has never been more important, smart brokers can use this to their advantage, differentiating themselves from the competition by explaining to clients why they do need cover – generally because it will give them more protection and save them money.

As BIBA’s Cargo Scheme Provider, we held a webinar in 2015 to help members understand why clients shouldn’t rely on cargo insurance arranged by others, showing them how to take control, and helping them to benefit from wider cover.

One of the main themes was not relying on insurance arranged by suppliers or customers:

  • If importers buy on CIF or CIP terms, the insurance that’s arranged for them by the seller may not be as wide as cover they could arrange themselves, and may be costing them more than they realise.
  • Exporters who sell on FOB/FCA or CFR/CPT terms may still find that buyers simply refuse to pay for goods that are lost or damaged, even though they should have insured the goods themselves.

Relying on freight forwarders or carriers can be problematical too:

  • Insurance arranged by forwarders can be expensive, and may not be as wide as cover that goods-owners could arrange themselves.
  • Carriers’ contractual liabilities for loss or damage are no substitute for insurance, and may pay as little as GBP1.30 per kilo of goods lost or damaged.

As well as overcoming all these issues, NMU gives members:

For those who weren’t able to join the webinar, you can download it here. There’s a handy guide to the Incoterms Rules too.

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